"Facts are meaningless. You could use facts to prove anything that's even remotely true!"
-Homer J. Simpson

Monday, March 19, 2007

Conservative Budget Breaks Promise to Saskatchewan

If this story is true then they broke their promise :

The Conservative budget proposes to exclude 50 per cent of non-renewable natural resources from the formula used to calculate equalization payments to the provinces. Premiers Lorne Calvert of Saskatchewan and Danny Williams of Newfoundland had lobbied hard for 100 per cent exclusion of non-renewable natural resources, but analysts had predicted 50 per cent inclusion was more realistic.
Does this break the promise? Decide for yourself:

here is the conservative plan:

The plan
A Conservative government will:
• Work with the provinces in order to achieve a long-term agreement which would address the issue of fiscal imbalance in a permanent fashion.
• Work to achieve with the provinces permanent changes to the equalization formula which would ensure that non-renewable natural resource revenue is removed from the equalization formula to encourage economic growth. We will ensure that no province is adversely affected from changes to the equalization formula.

"Ensure that non-renewable natural resource revenue is removed from the equalization formula" Not "removed with a cap" not "sort or removed but not really"

Let's see what the conservatives said in the house:

“The matter of equalization has to do with Saskatchewan's natural resources which by right of the Constitution we should have complete access to, we should have total and complete benefit of.
- Mr. Bradley Trost (Saskatoon—Humboldt, CPC) Hansard

"It is our position that non-renewable resources such as oil and gas should not be in the formula. "
- Mr. Ed Komarnicki (Souris—Moose Mountain, CPC) Hansard

"Will the minister or his designate stand in the House today and do what is right, do what is fair, and simply commit to the elimination of the clawback provisions and give Saskatchewan people the same deal as afforded to Newfoundland and Labrador and Nova Scotia?"
- Mr. Tom Lukiwski (Regina—Lumsden—Lake Centre, CPC) Hansard
It was interesting to hear him say that equalization is not really about equality. It seems to me that it is…. We know that the current equalization formula is flawed…. We agree that Newfoundland and Labrador and Nova Scotia deserve to keep their offshore gas and oil revenues. However, we think that what is fair for those provinces is also fair for Saskatchewan…. . This change should be a slam dunk.
- Mr. David Anderson (Cypress Hills—Grasslands, CPC) Hansard
"Representatives of the people of Saskatchewan are obliged to speak out against an equalization system that penalizes our province with an over-emphasis on non-renewable resources and a complete failure to accurately measure fiscal capacity.
- Mrs. Lynne Yelich (Blackstrap, CPC) Hansard

This means the following (according to CTV again)

The fiscal capacity cap, another new measure in the budget, is intended to ensure that the formula doesn't unfairly bring a receiving province's overall fiscal capacity to a level higher than that of any non-receiving, or "have" provinces.

Under the measure, no province can bring in more revenue than Ontario, which doesn't receive a payment from the equalization program earns less revenue than Alberta.

That cap has a significant effect on Saskatchewan, which is currently a have-not province but has significant natural resources revenue.

In other words, Saskatchewan is to get about 220 million.


To put it into perspective, a new equalization deal would have meant an additional $750 million for Saskatchewan, my province, this year alone.
- Mr. Dave Batters (Palliser, CPC) Hansard

"It is estimated that Saskatchewan, had it received that same deal a decade ago, would have received an additional $8 billion for the province from non-renewable resource revenues…. In regard to equalization, Saskatchewan is being treated very unfairly
- Mr. Maurice Vellacott (Saskatoon—Wanuskewin, CPC) Hansard

"By my understanding, if Saskatchewan were allowed to keep 100% of its non-renewable natural resources, it would mean an estimated $800 million yearly and perhaps even higher than that".
- Tom Lukiwski source: Federal Hansard, March 22, 2005

Remember that Saskatchewan Conservative MP's - Brad Trost, according to the CBC said that Saskatchewan would get the "best deal ever" which may be true - but he also said that it would be just as good as they were promising:

Brad Trost said while caucus discussions are confidential, MPs from Saskatchewan are intent on keeping their promise to get a new equalization deal for the province.

"Let me give you a 100 per cent guarantee, Prime Minister Harper will give Saskatchewan the best deal it's ever had from any prime minister ever, " he said.

A 100% guarantee, eh? That's a pretty strong statement. But it ge's even better, what does Trost go on to say:

Asked if that would be the same deal the Conservatives campaigned on, Trost said: "If it isn't, it better be better."
Let's see what his fellow MP Tom Lukiwiski had to say (from the same article:

Before the Conservatives formed the goverment, Lukiwski said the two proposed changes to the equalization formula could mean at least $2 billion a year extra for Saskatchewan government coffers.

So Saskatchewan gets 220 million - which is not $2 billon or $8 billion or even $800 million - which are all numbers that THE CONSERVATIVES SAID WE WOULD GET

This has been a Saskatchewan Screw Job - Harper Style

Read more here