Finance Minister Travis Toews (Photo: Chris Schwarz / Government of Alberta)

By Shaun Penner

Referendum

“Are we getting treated equitably?”: Toews as Alberta vote on equalization referendum

Oct 17, 2021 | 7:00 AM

Should a majority of Albertans vote in favour of the idea of removing the practice of equalization from the federal constitution, Alberta’s finance minister says the provincial government would use that as leverage to bring the federal and other provincial governments to the table, to renegotiate Alberta’s financial position in the federation.

This comes a day ahead of the municipal election, which includes a provincial referendum question asking Albertans whether they would support the removal of Section 36(2) of the Constitution Act-1982, which involves the practice of equalization payments.

Travis Toews, who is also the MLA for Grande Prairie-Wapiti, suggests it’s a topic that has long been of much concern to his constituents and many other Albertans.

The practice of equalization payments is in the constitution to ensure all provincial governments have sufficient revenues to provide reasonably comparable levels of public services at reasonably comparable levels of taxation across Canada.

“I don’t think Albertans are opposed to supporting some parts of the province that are perhaps less fortunate than we are, but there are some very egregious calculation methodologies in the equalization formula that make this particular program quite unfair.”

Meaningful Mementos

Remembering Someone You've Lost at Christmas

Dec 03, 2024

Seasonal Sorrow

How Do You Get Through The Holidays When You're Grieving?

Nov 01, 2024

Upcoming Events at Oliver's

Grief & Loss and Estate Planning Seminars

Oct 02, 2024

Where Toews feels the current formula is unfair, particularly, is around the inclusion of 50% of non-renewable resource revenues in the formula, as Alberta’s economy is heavily based upon its resource sector.

He believes this leads other provinces to not tap into their own resource sector, while Alberta’s revenues are highly reliant on the sector.

“The fact that it includes those non-renewable resource revenues at all provides a disincentive for provinces to develop their own natural resources,” said Toews. “I’m certainly of the view that every province should have the autonomy or the authority to make a decision whether or not they want to develop their resources.”

With Alberta’s revenues being higher on average, albeit more volatile, due to its resource sector, Toews feels Alberta is paying more than most other provinces have into fiscal transfer programs like equalization.

“Over the last five years, Alberta has made a net contribution of close to $100 billion. Close to $20 billion a year to the rest of the country,” said Toews.

With that, Toews suggests the question Albertans should be asking as they consider the question around equalization is whether they feel Alberta is being treated fairly within the federation.

“Are we getting treated equitably? Considering our great contribution, at a time when certain governments across the country are getting in the way of necessary, energy industry infrastructure.”

While acknowledging there will be no immediate change if most Albertans vote in favour of removing equalization from the constitution, Toews says it would at least act as strong evidence for how Albertans feel at this time.

He would then hope this would lead to good-faith negotiations with other governments around the practice of equalization, as well as other federal transfer programs like the Fiscal Stabilization Program.

“We would see this as, really, an important lever that would allow us to hopefully negotiate a better deal for the province within confederation,” said Toews. “There are certainly, at a minimum, real improvements that need to be made to the equalization formula and methodology.”

The referendum on equalization is one of two questions being asked on the municipal ballot, along with the question of remaining on Daylight Savings Time year-round in Alberta.

Senate nominee elections are also on the municipal ballot.

Election day across Alberta is Monday, October 18.