By Canadian Press

B.C. premier wants to support N.L.’s plan to sue Ottawa over equalization program

Jul 15, 2024 | 2:18 PM

HALIFAX — British Columbia’s premier says he wants to support Newfoundland and Labrador’s plans to sue Ottawa over the federal equalization program, which transfers money from wealthier provinces to poorer ones, calling the current formula “completely absurd.”

David Eby told reporters Monday he hopes to have an announcement on the matter before the three-day Council of Federation meetings of Canada’s premiers in Halifax wraps up on Wednesday. The premier said British Columbia taxpayers are put at a disadvantage by the equalization formula, which is an attempt by Ottawa to reduce regional wealth disparities across the country.

“The thing that really frustrates me, and an issue that I’m raising at the (Council of Federation) table and generally, is that B.C. taxpayers are sending tax dollars to Ontario through equalization. That is completely absurd. Ontario is not struggling to provide schools or hospitals,” Eby said.

British Columbia has not received payments from equalization in more than a decade.

Eby claims that equalization “has resulted in the last two years of a billion dollars going to Ontario, while B.C. taxpayers are struggling, just like everyone else, with affordability issues.”

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On May 30, Newfoundland and Labrador said the province would file a constitutional challenge against Ottawa over the program “in the coming weeks.” The Newfoundland and Labrador government has said the formula is flawed, and the province could have received between $450 million and $1.2 billion in each of the last five years instead of receiving nothing.

Newfoundland and Labrador Premier Andrew Furey said Monday that despite his province’s court challenge, he’s hopeful that upcoming talks with the federal government will allow both sides to avoid legal action.

“But again, we’re firm in our proposition that the (equalization) formula isn’t being equally applied. It doesn’t contemplate the cost to deliver services. As a result, that doesn’t reflect the spirit of what was signed in the Constitution,” Furey told reporters Monday in Halifax.

Furey said he has had “good meetings” about equalization with Eby, Alberta Premier Danielle Smith and Saskatchewan Premier Scott Moe — who has already expressed willingness to join Newfoundland and Labrador’s legal action.

Eby would not confirm on Monday whether his province would join the lawsuit, but he said the status quo is “completely unacceptable.”

“It is my continuing frustration with the federal government that they offer programs to other provinces that are not available in British Columbia,” he said, adding that Ottawa has announced it will spend $1.2 billion on a hospital that serves First Nations in northern Ontario.

“Let me tell you, we could certainly use investment like that in B.C.,” he said.

This report by The Canadian Press was first published July 15, 2024.

Lyndsay Armstrong, The Canadian Press