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Alberta

Equalization Program grows to record $20.9 Billion – Fairness Alberta looking to Ontario and BC for support

Published

3 years ago

4 minute read

This article submitted by Fairness Alberta

FAIRNESS ALBERTA: RECORD EQUALIZATION PAYMENTS IN BUDGET ARE UNFAIR, UNAFFORDABLE, AND UNNECESSARY

Fairness Alberta has released an analysis highlighting how this year’s federal budget allocates a record $20.9 billion to the Equalization program and plans to hike payments to so-called ‘have not’ provinces by 20% over the next four years.

Fairness Alberta Executive Director Dr. Bill Bewick is calling on Canadians in British Columbia and Ontario in particular – who will pay roughly $2,400 per family of four this year into payments for others – to join Albertans in demanding Equalization reform.

“The $20 billion-and-growing price tag for Equalization payments to 30% of the country is not just unaffordable, it is totally unfair and unnecessary given how much the gap between the ‘have’ and ‘have not’ provinces shrunk since 2015,” said Dr. Bewick. “When you consider the higher costs and budget struggles in places like Ontario, B.C., and Alberta, it is unacceptable to take so much from them to fund other provinces’ budgets, and outrageous that this would increase by 20% over the next four years.”

Fairness Alberta used the most recent Library of Parliament breakdown of federal revenues by province to estimate the share of Equalization funding that comes from each province, and broke it down to a per capita basis.
Alberta families are contributing about $2,700 to cover this year’s record Equalization payments, and Ontario and B.C. families are on the hook for about $2,400 each at a time when every provincial government is under tremendous strain.  Fairness Alberta recently called for a rebate to contributing provinces until a new formula is worked out or Equalization is scrapped altogether.

“The 67% of Canadians in the contributing provinces were struggling with their own provincial services even before COVID-19,” said Dr. Bewick.  “Given the collapse of the wealth gap between provinces, the ‘have’ provinces should get the share of Equalization that came from their taxpayers rebated until serious reforms are made.”

As Dr. Bewick outlined recently in the National Post, even a 50% rebate would mean a bump to provincial budgets of $4 billion in Ontario, and $1.5 billion being returned to B.C. and Alberta as provincial responsibilities like health care come under strain.

Fairness Alberta is a grassroots, non-partisan, and non-separatist association of concerned citizens, aiming to increase awareness across the country related to Albertans’ major contributions to Canada, while also providing clear, factual information on unfair federal policies that are anticipated to undermine the prosperity of Alberta and other contributing provinces further.

Fairness Alberta previously released analysis and recommendations for reforms to Equalization and the Fiscal Stabilization program, with an overview of fiscal federalism as well at fairnessalberta.ca.

Our previous releases, interviews, columns, and presentations to the House of Commons Standing Committee on Finance can be found in the NEWS section of our website. For more information on Fairness Alberta, its mandate, and future plans, please visit our website at www.fairnessalberta.ca.

For further information or to arrange interviews, please contact:

Bill Bewick, Ph.D.
Executive Director
Fairness Alberta
Cell: (780) 996-6019
Email: [email protected]
Background Calculations:

Ben Eisen and Milagros Palacios recently published a reportshowing the “Great Convergence” in provincial fortunes since the 2015 energy downturn.  While the gap between the median ‘have’ and ‘have not’ fell from $5000 per person in 2015 to only $1600 now, Equalization payments grew by 23%. This year’s $20.9 billion windfall to 5 provinces with one-third of the population is budgeted for $25.1 billion in 4 years.

Using the contribution rates to federal revenues by province last updated here we broke down Equalization funding per capita as follows:
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Alberta awash in corporate welfare

Published on July 26, 2024

By

From the Fraser Institute

By Matthew Lau

To understand Ottawa’s negative impact on Alberta’s economy and living standards, juxtapose two recent pieces of data.

First, in July the Trudeau government made three separate “economic development” spending announcements in  Alberta, totalling more than $80 million and affecting 37 different projects related to the “green economy,” clean technology and agriculture. And second, as noted in a new essay by Fraser Institute senior fellow Kenneth Green, inflation-adjusted business investment (excluding residential structures) in Canada’s extraction sector (mining, quarrying, oil and gas) fell 51.2 per cent from 2014 to 2022.

The productivity gains that raise living standards and improve economic conditions rely on business investment. But business investment in Canada has declined over the past decade and total economic growth per person (inflation-adjusted) from Q3-2015 through to Q1-2024 has been less than 1 per cent versus robust growth of nearly 16 per cent in the United States over the same period.

For Canada’s extraction sector, as Green documents, federal policies—new fuel regulations, extended review processes on major infrastructure projects, an effective ban on oil shipments on British Columbia’s northern coast, a hard greenhouse gas emissions cap targeting oil and gas, and other regulatory initiatives—are largely to blame for the massive decline in investment.

Meanwhile, as Ottawa impedes private investment, its latest bundle of economic development announcements underscores its strategy to have government take the lead in allocating economic resources, whether for infrastructure and public institutions or for corporate welfare to private companies.

Consider these federally-subsidized projects.

A gas cloud imaging company received $4.1 million from taxpayers to expand marketing, operations and product development. The Battery Metals Association of Canada received $850,000 to “support growth of the battery metals sector in Western Canada by enhancing collaboration and education stakeholders.” A food manufacturer in Lethbridge received $5.2 million to increase production of plant-based protein products. Ermineskin Cree Nation received nearly $400,000 for a feasibility study for a new solar farm. The Town of Coronation received almost $900,000 to renovate and retrofit two buildings into a business incubator. The Petroleum Technology Alliance Canada received $400,000 for marketing and other support to help boost clean technology product exports. And so on.

When the Trudeau government announced all this corporate welfare and spending, it naturally claimed it create economic growth and good jobs. But corporate welfare doesn’t create growth and good jobs, it only directs resources (including labour) to subsidized sectors and businesses and away from sectors and businesses that must be more heavily taxed to support the subsidies. The effect of government initiatives that reduce private investment and replace it with government spending is a net economic loss.

As 20th-century business and economics journalist Henry Hazlitt put it, the case for government directing investment (instead of the private sector) relies on politicians and bureaucrats—who did not earn the money and to whom the money does not belong—investing that money wisely and with almost perfect foresight. Of course, that’s preposterous.

Alas, this replacement of private-sector investment with public spending is happening not only in Alberta but across Canada today due to the Trudeau government’s fiscal policies. Lower productivity and lower living standards, the data show, are the unhappy results.

Author:

Matthew Lau
Adjunct Scholar, Fraser Institute
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Alberta

‘Fireworks’ As Defence Opens Case In Coutts Two Trial

Published on July 25, 2024

By

From the Frontier Centre for Public Policy 

By Ray McGinnis

Anthony Olienick and Chris Carbert are on trial for conspiracy to commit murder and firearms charges in relation to the Coutts Blockade into mid-February 2022. In opening her case before a Lethbridge, AB, jury on July 11, Olienick’s lawyer, Marilyn Burns stated “This is a political, criminal trial that is un Canadian.” She told the jury, “You will be shocked, and at the very least, disappointed with how Canada’s own RCMP conducted themselves during and after the Coutts protest,” as she summarized officers’ testimony during presentation of the Crown’s case. Burns also contended that “the conduct of Alberta’s provincial government and Canada’s federal government are entwined with the RCMP.” The arrests of the Coutts Four on the night of February 13 and noon hour of February 14, were key events in a decision by the Clerk of the Privy Council, Janice Charette, and the National Security Advisor to the Prime Minister, Jody Thomas, to advise Prime Minister Justin Trudeau to invoke the Emergencies Act. Chief Justice Paul Rouleau, in submitting his Public Order Emergency Commission Report to Parliament on February 17, 2023, also cited events at the Coutts Blockade as key to his conclusion that the government was justified in invoking the Emergencies Act.

Justice David Labrenz cautioned attorney Burns regarding her language, after Crown prosecutor Stephen Johnson objected to some of the language in the opening statement of Olienick’s counsel. Futher discussion about the appropriateness of attorney Burns’ statement to the jury is behind a publication ban, as discussions occurred without the jury present.

Justice Labrenz told the jury on July 12, “I would remind you that the presumption of innocence means that both the accused are cloaked with that presumption, unless the Crown proves beyond a reasonable doubt the essential elements of the charge(s).” He further clarified what should result if the jurors were uncertain about which narrative to believe: the account by the Crown, or the account from the accused lawyers. Labrenz stated that such ambivalence must lead to an acquittal; As such a degree of uncertainty regarding which case to trust in does not meet the “beyond a reasonable doubt” threshold for a conviction.”

On July 15, 2024, a Lethbridge jury heard evidence from a former employer of Olienicks’ named Brian Lambert. He stated that he had tasked Olienick run his sandstone quarry and mining business. He was a business partner with Olienick. In that capacity, Olienick made use of what Lambert referred to as “little firecrackers,” to quarry the sandstone and reduce it in size. Reducing the size of the stone renders it manageable to get refined and repurposed so it could be sold to buyers of stone for other uses (building construction, patio stones, etc.) Lambert explained that the “firecrackers” were “explosive devices” packaged within tubing and pipes that could also be used for plumbing. He detailed how “You make them out of ordinary plumbing pipe and use some kind of propellant like shotgun powder…” Lambert explained that the length of the pipe “…depended on how big a hole or how large a piece of stone you were going to crack. The one I saw was about six inches long … maybe an inch in diameter.”

One of Olienick’s charges is “unlawful possession of an explosive device for a dangerous purpose.” The principal evidence offered up by RCMP to the Crown is what the officers depicted as “pipe bombs” which they obtained at the residence of Anthony Olienick in Claresholm, Alberta, about a two-hour drive from Coutts. Officers entered his home after he was arrested the night of February 13, 2022. Lambert’s testimony offers a plausible common use for the “firecrackers” the RCMP referred to as “pipe bombs.” Lambert added, these “firecrackers” have a firecracker fuse, and in the world of “explosive” they are “no big deal.”

Fellow accused, Chris Carbert, is does not face the additional charge of unlawful possession of explosives for a dangerous purpose. This is the first full week of the case for the defence. The trial began on June 6 when the Crown began presenting its case.

Ray McGinnis is a Senior Fellow with the Frontier Centre for Public Policy who recently attended several days of testimony at the Coutts Two trial.

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