Provincial finance ministers divided on top priority for meeting with Morneau

Expanding the fiscal stabilization program is top priority, says finance ministers

Provincial finance ministers appeared divided into two camps going into a Tuesday meeting in Ottawa with federal Finance Minister Bill Morneau, who indicated that few concrete decisions would be made at the gathering.

Ministers from Alberta and Newfoundland and Labrador declared the need to expand the fiscal stabilization program as their top priority in talks with the federal finance minister.

“We believe that the fiscal stabilization program needs fundamental change in order to deliver on its purposes,” Travis Toews, the Alberta finance minister, declared on his way into the meeting.

“Our No. 1 priority is to request that the caps be lifted.”

The fiscal stabilization program is easier to change than the more complex equalization program, and amendments could be worth billions to provinces whose finances have been hit by low oil prices.

The stabilization program provides financial assistance to provinces facing a year-over-year decline in its non-resource revenues, but the money available to eligible provinces is capped at just $60 per resident.

Toews said those rules left Alberta to pretty much fend for itself when it was facing a budget deficit resulting from cratering oil prices.

READ MORE: Five highlights in the 2019 federal budget

Prior to attending a working dinner Monday evening with his provincial and territorial counterparts, Morneau acknowledged the program, which has not changed since 1995, needs some adjustments to how stabilization payments are calculated.

“The calculations are antiquated and no longer reflect the priorities of provinces, especially resource-producing provinces,” said Newfoundland and Labrador Finance Minister Tom Osborne.

Meanwhile finance ministers from some other provinces, including Manitoba, Prince Edward Island and Quebec, said increasing federal transfers for health care was their most pressing concern.

“I know from talking to my colleagues, and I know from talking to Minister Morneau, that health care is a key priority of this government and additional support from the federal government is going to be critical to doing that,” said Ontario Finance Minister Rod Phillips.

For his part, Morneau said it came as no surprise that the provinces would be requesting more funding at their meeting. He suggested, however, that the Trudeau government would not be making any near-term commitments to additional spending on the stabilization program.

“I think it’s important for us to listen to the issues that we hear today and to take that back, and consider how we can look at the program in a way to make sure it continues to be effective,” Morneau told reporters.

None of those going into the meeting Tuesday morning expressed strong concerns about the federal government’s ballooning budget deficits, saying they believe Ottawa has more room to manoeuvre.

Figures released Monday showed the federal deficit is slated to hit $26.6 billion this fiscal year, up from last spring’s projection of $19.8 billion.

Terry Pedwell, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Coastal GasLink pipe continues to arrive in Terrace

Shipped by rail from Saskatchewan

No injuries reported following propane leak in Terrace

Hwy 16 closed off, businesses evacuated as emergency crews responded

Coastal GasLink stresses pipeline ‘on a schedule’ as B.C. appoints liaison for Wet’suwet’en

670-kilometre pipeline is schedule to be completed by end of 2023

River Kings dethrone Rampage to reclaim first place in CIHL standings

Terrace is heading to Rupert rivals Jan. 31 in what will be a pivotal match for first place

COLUMN | Creating a “community of practice” inspires

Art Matters by columnist Sarah Zimmerman

B.C. reports first coronavirus in Vancouver region

First patient visited Wuhan, China, reported symptoms

Victoria resident says WestJet employee uttered racist comment, refused to let her on plane

Customer claims she was told ‘You guys can’t handle your alcohol’ by WestJet employee

Bystander who tried to help dog being attacked not liable for its death: B.C. tribunal

Owner of dog killed tried to get $5,000 in damages from man who tried to save it

INFOGRAPHIC: See how fast your B.C. city grew in 2019

The province’s fastest-growing municipalities were located on Vancouver Island

Landowner hearings begin for Trans Mountain expansion in Alberta

Detailed route talks start in Spruce Grove, in B.C. communities soon

VIDEO: Canada looking to help 126 Canadians quarantined in China for coronavirus

China has confirmed more than 4,500 cases of the new virus, with more than 100 deaths

Alessia Cara to host and perform at 2020 Juno Awards

Multi-platinum Canadian singer-songwriter also up for six awards, including Artist of the Year

Watch out for scams, clickbait in the wake of Kobe Bryant’s death: Better Business Bureau

Kobe Bryant and his daughter were killed in a helicopter crash near Los Angeles

‘Very disrespectful’: Headstones at Okanagan cemetery damaged by excavation crew

Headstones at Enderby’s Cliffside Cemetery mistakenly driven over by excavation crew

Most Read