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HILL: It’s time to finally reform Canada’s equalization program
['Tegan Hill']
Calgary Sun
Premier Danielle Smith is pushing for equalization reform — the federal program that (in theory) redistributes money from “have” provinces such as Alberta to deemed “have not” provinces including Quebec and provinces in Atlantic Canada to help them provide government services.
Article contentLet’s dig into what exactly Premier Smith is talking about.
In 2009, in an effort to control costs, the Harper government introduced the “fixed growth rate rule” so the overall size of the equalization envelope would grow roughly in line with the Canadian economy.
But because of the fixed growth rate rule, the equalization envelope has continued to increase.
As a result, a rule intended to constrain the cost of the equalization program instead forced Ottawa to spend an extra $10.5 billion since 2018/19 — money that did not need to be spent.