Friday, January 12, 2007

Fiscal Imbalance

What is fiscal imbalance?
It means different things to different provinces.

It means the fiscal relationship between Ottawa and the Provinces.
Quebec likes to control the tax base of Quebeckers as much as can be negotiated and to a large extent the relationship between Ottawa and Quebec versus Ottawa and the rest of the Provinces is different. Not because they are Quebec but because the politicans of that province have negotiated a different deal.
Quebeckers are the only people in Canada to pay a different level of federal taxation - they have more control over health and social funding traditionally coming from Ottawa in the form of transfers.
Right off - this is a fiscal imbalance.
Then there was the whole Micheal Wilson - Paul Martin philosophy of debt reduction through downloading of service responsibility to the provinces by cutting federal transfers. It did eliminate federal deficits and reduce the debt - however it caused increased fiscal imbalance - that is to say that Canadian universal services such as health that should be equally available to all Canadians was severely crippled and less populated provinces paid a heavy toll. Now Stephen Harper wants the provinces to provide guaranteed wait times. Well we may get there but not wothout significantly more dollars. Another fiscal imbalance.
Then there are provinces like Newfoundland and Labrador - Nova Scotia - and BC that suffer the interference of Ottawa in natural resource developments and revenues.
You see the offshore of Newfoundland and Labrador belongs to Canada instead of the province. As a result - the oil and gas resources found on the ocean bed belong to Canada. Natural resources - constitutionally are owned and managed by the individual province. So Alberta owns it's oil. Manitoba owns its fields.
This is a problem which will not go away easily and has more potential to upset Canadian Unity than any other issue. It is not only Quebec...

Speak - up and tell the politicians what your beef is.

What do you think fiscal imbalance means to your province?

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