Some Alberta MLAs say equalization causes eastern Canadian economic malaise

·3 min read
Some MLAs say eastern Canadian provinces rely so heavily on equalization transfers, it prevents them from further developing their economies. (Josee St-Onge/ CBC - image credit)
Some MLAs say eastern Canadian provinces rely so heavily on equalization transfers, it prevents them from further developing their economies. (Josee St-Onge/ CBC - image credit)

Canada's equalization program is a crutch designed by "Laurentian elites" that prevents eastern Canadian provinces from stimulating their own economies, said several backbench United Conservative MLAs on Wednesday.

A debate in the legislature over how to convey Alberta's equalization referendum result to the federal government sparked harsh words from some MLAs.

"In the real world, Quebec would be kicked out of the partnership," said Jason Stephan, MLA for Red Deer-South. "Another truth: If Quebec was Alberta, they would have left this partnership long ago."

In a referendum last month, 62 per cent of Alberta voters wanted to remove Canada's commitment to making equalization transfers from the constitution. Alberta doesn't have that power unilaterally, but Premier Jason Kenney has said the vote gives the province leverage to insist the federal government to engage in renewed talks about the fairness of the current formula.

Kenney says his goal isn't constitutional reform, but an end to the federal government adopting policies that make it more difficult for Alberta to generate wealth from developing its oil and gas industry.

The federal government is trying to balance that pressure from Alberta with its commitment to meeting international emissions reductions targets to slow down climate change.

Equalization is meant to ensure Canadians have access to equivalent public services regardless of where they live.

Members of Alberta's legislature are now debating a motion to ratify its referendum results, push Ottawa for renewed talks and a constitutional amendment, and "secure a fair deal for Alberta in the Canadian confederation."

During that debate, UCP MLA Stephan said equalization was socialism, which he called "the enemy of self-reliance."

Sherwood Park MLA Jordan Walker said the program was a "wealth transfer scheme" designed by "Laurentian elites" who look down upon Alberta.

He said it "breed(s) a culture of entitlement and dependency" and blamed it for causing chronically high unemployment in Atlantic Canada.

"And Quebec disproportionately benefits. And Alberta's carrying everyone on their back," he said, spreading his arms wide. "Unbelievable. I think Atlas is going to shrug here."

Although Kenney has said his aim is not to amend the constitution, several MLAs said they wanted equalization excised from it.

Chestermere-Strathmore MLA Leela Aheer took a more conciliatory tone, saying Alberta will have to convince other provinces to co-operate if they are to achieve constitutional change.

Independent MLA Todd Loewen said the government's referendum motion lacks teeth. He said it should specify a deadline by which the federal government must act, and potential consequences if they fail to offer amenable concessions.

Loewen, who was booted out of the UCP caucus earlier this year when calling for Kenney's resignation, said the premier is using the referendum to prolong his spat with the federal government as a political tactic. It won't prompt meaningful change, he said.

"Albertans don't need an endless war of words with Ottawa," he said. " What we need is jobs, growth and fairness within confederation."

Alberta has been a net contributor to equalization for decades, due to higher earnings in the province leading to more federal tax payments.

However, an influx of federal pandemic supports, low oil prices and an economic slump reversed that trend in 2020.

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