“Equalization Payments”…is there a pair of words that stick more in the craw of independence-minded British Columbians?
The only thing that infuriates more is the complexity of equalization payments and the formula used to determine them. Now, I’m not an expert by any means but I have read enough to know a bit about it, certainly enough to be angry with it, and even angrier that it can’t be stopped easily.
Pierre Elliot Trudeau, the man Westerners love to hate, entrenched the equalization system into the Canadian Constitution. It was meant (according to Liberals) to make the standard of living and services available to all Canadians equal whether in BC, Alberta, Ontario or Nova Scotia. But in practice, like everything Trudeau did, it was designed to enrich the traditional voter base of Quebec. And like the National Energy Program it did so at the expense of the West.
Being in the Constitution, it requires a constitutional amendment to change or stop, meaning the change needs to be approved by, 1) the federal Parliament, 2) the Senate, and 3) a minimum number of provincial legislatures. There must be at least seven provinces that approve the change, representing at least 50% of Canada’s population.
I wonder what are the chances of that happening? Let’s see, Ontario and Quebec have 62.1% of the Canadian population, Quebec (24) and Ontario (24) have more Senators than the whole West (24 combined)…well, you see what I mean…
So where do these equalization payments come from and how do they get redistributed to the various “have not” provinces? This is where it becomes akin to voodoo magic for the average British Columbian, so break out your dolls and pins.
According to the Mowat Centre, Federal transfers are determined by a formula based on federal legislation. This money is often referred to as Transfer Payments and help guarantee “reasonably comparable levels” of health care, education, and welfare in all the provinces. Note that the Territories are not included, they get separate funding.
The cash comes from provincial taxation per capita and goes into the Canadian Federal Government coffers. The money the provinces receive back in Transfers, Canada Social Transfer and Canada Health Transfer, can be spent anything the receiving government desires, accountability for the stated “reasonably comparable” purposes is loose, to say the least. This is probably why Quebec’s undergraduate tuition rates were just $2,519 this past year. That was: 38 percent of what an Ontario student paid ($6,640); 44 percent of the cost to a student in Alberta ($5,662); 45 percent of what a Saskatchewan student paid ($5,601); and 52 percent of what a B.C. student shelled out ($4,852). (Ref. Fraser Institute)
On physician ratios, in 2010, British Columbia and Alberta had 213 and 211 general physicians respectively per 100,000 people; the numbers for Ontario and Saskatchewan were 189 and 169. Meanwhile, the Quebec ratio was 224 general physicians per 100,000 people. (Ref. Fraser Institute)
There are in fact areas, particularly in Social Transfers, where BC does benefit. However the question we are always asking from our perspective as secessionists is: How would BC, the West, do without federal equalization transfers?
Those who enjoy the commuter’s “Colwood Crawl” in Victoria, might have an opinion on this. The insanely slow traffic has been a sore spot for people in Greater Victoria for years and years. And for just as long, experts in the levels of government have studied the issue and finally decided to create an overpass system to reduce traffic and anger over the lengthy project. The cost of this project is some 85 million dollars, funded by the federal ($32.6 million) and provincial ($52.4 million) governments. Remember that part of equalization is infrastructure funding based on need and merit and that the amount BC sends to Ottawa is more than it receives. Perhaps the project could’ve been done earlier if BC were part of an independent West free to fund its own projects? Food for thought.
I encourage readers to discuss these subjects and more with their fellow Westerners, a small flame must have a bit of wind to grow to a fire. Watch for more on this site in the future, feel free to comment and add your expertise to future entries.