March 22, 2018
For Immediate Release

Quebec and NL Budgets Worlds Apart Because of Equalization

Keith Hutchings, Finance Critic for the Official Opposition, said, “The 2018 budgets of Quebec and Newfoundland and Labrador will be worlds apart because of the huge windfall Quebec is getting from the Equalization program.”

“This year, Quebec will get $11.7 billion in Equalization, up from $11.1 billion last year. Over the past decade, Quebec has received $91.6 billion while our province has received zero,” said Hutchings.

In fact, Ottawa’s Parliamentary Budget Officer estimates that Quebec’s take from Equalization will grow even larger. In its Fiscal Sustainability Report 2017, released on October 5, 2017, the PBO stated: “In our projections, Quebec’s share of the total federal equalization envelope increases from 60 per cent in 2017 to 75 per cent in 2091.”

Hutchings said, “Quebec has used its windfall to balance budgets, improve public services and cut taxes. They have subsidized daycare at rates that most Canadians can only dream of. In their 2017 budget, they projected a $2.5 billion surplus, even while receiving Equalization. They have also been socking money away in a Generations Fund since 2006, and will start accessing that fund at a rate of $2 billion a year to pay down their debt.”

“Since the automatic 25-year renewal of the Upper Churchill contract in 2016, Hydro-Quebec is getting Upper Churchill power at a renewal rate of just a fifth of a cent per kilowatt hour and reselling our power for a windfall on the market,” he said.

“Quebec has indeed figured out how to use the ‘fiscal capacity’ provision of the Equalization formula, with revenues in the billions from Hydro-Quebec and leased real estate to the provincial government, which amazingly is not included in their revenue generation as a province; and drives the current inequality and a broken formula, to Newfoundland and Labrador’s detriment. “

“As oil fell, we felt the effects harder than others in Canada and needed to have strong representation, but Premier Ball said ‘it is what it is,’ which seems to be what our great relationship with the Liberal federal government has given us,” said Hutchings.

Province Equalization 2017-18 ($B) Equalization 2018-19 ($B)
Newfoundland and Labrador 0 0
Nova Scotia 1.779 1.933
Prince Edward Island 0.390 0.419
New Brunswick 1.760 1.874
Quebec 11.081 11.732
Ontario 1.424 0.963
Manitoba 1.820 2.037
Saskatchewan 0 0
Alberta 0 0
British Columbia 0 0
TOTAL 18.254 18.958

Source: https://www.fin.gc.ca/fedprov/mtp-eng.asp
 

Quebec Equalization
09-10 = $8.355
10-11 = $8.552
11-12 = $7.815
12-13 = $7.391
13-14 = $7.833
14-15 = $9.286
15-16 = $9.521
16-17 = $10.030
17-18 = $11.081
18-19 = $11.732
TOTAL = $91.596

Newfoundland and Labrador Equalization (same ten-year period) = $0

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Media Contact: Heather MacLean, Director of Operations and Communications
Office of the Official Opposition
(709) 729 6105, heathermaclean@gov.nl.ca