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A fair deal for Alberta must include equalization reform

February 01, 2020
A fair deal for Alberta must include equalization reform

Trying to get a fair deal for Alberta without challenging equalization is like swinging for the fence and then running straight to second base without even glancing at first.

Alberta Premier Jason Kenney commissioned the Fair Deal Panel to consult Albertans on how our province can get a better deal in the federation. The panel was tasked with looking into nine specific measures ranging from starting our own provincial pension plan to establishing an Alberta constitution. But none of these nine measures includes equalization. In fact, the word equalization isn’t even mentioned in the panel’s mandate letter.

Shouldn’t equalization be front-and-centre in the panel’s mandate? If panel members asked a random Albertan on the streets of Taber or Peace River how to get a fair deal for Alberta, what do you think they would hear? A good bet would be something along the lines of “scrap equalization” with “build those pipes” a close second.

Here’s how the government’s own Fair Deal website describes the need for this whole exercise:

“We've been the biggest contributing province to Canada’s prosperity by far, but some provinces that are profiting from our resources now seem determined to landlock our industries,” states the website.

The government could have saved a bunch of words by simply replacing that sentence with “equalization is broken.”

Albertans have paid way more in federal taxes than we have received back from Ottawa.

“Six-hundred and eleven billion dollars and counting. That is how much Albertans have paid to the rest of Canada in net federal fiscal transfers from 1961 to 2017,” explains economist Jack Mintz. “Over 57 years, it totals $209,418 per Albertan.”

Equalization is only one part of the wider federal transfer issue. But through equalization, Albertans directly subsidize politicians who seem to take pride in blocking our development. Not to mention, the last cent we received from the program was more than five decades ago. And we can make progress on equalization by forcing the feds to the negotiation table by holding a provincial referendum.

Kenney has already promised to hold a referendum on equalization in 2021. But as every fourth grader learns in their intro to social studies class, political promises can be worth about as much as the paper they’re written on. And Kenney has already backtracked on his equalization promise.

In 2017, Kenney promised a referendum if the federal government forced its carbon tax on Albertans. He now says he’ll hold the referendum if there is no progress on a pipeline and legislation that will block further pipeline development. But Kenney should be taking on the equalization program regardless of what happens with carbon taxes or pipelines. Albertans also don’t need to get milked for nearly two more years before there’s any real movement on equalization.

Fortunately, there’s flexibility within the Fair Deal Panel’s mandate. While equalization isn’t a specific focus, the panel’s “recommendations may extend beyond these concepts, and may include government platform commitments.”

The panel should recommend that Kenney hold a referendum on equalization this year. That’s because there is no fair deal for Albertans while we continue to give more and more money to politicians who refer to our oil as “dirty energy” and continue to oppose our development. There is no fair deal for Alberta without changes to equalization.

This column was originally published in the Calgary Sun on Feb. 1, 2020.

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