Equalization payments continue to split federal-provincial finance ministers

Just a reminder

Equalization payments have nothing to do with provincial finances. Equalization payments are calculated on the revenues of the Canadian citizens living in every province and territories.

Provinces do not pay equalization, it is taken out of the taxes that every citizen pays to Ottawa. Since Ontario pays the largest proportion of federal taxes of all provinces, most of the equalization payments are taken from what Ontarian workers pay.

For instance, in 2009, Quebec paid into the federal government almost $40 billion in taxes while Alberta contributed $36 billion. Ontario, in 2009, contributed $85 billion...

So, Ontario, in 2009, contributed MORE than Quebec and Alberta put together ($76 B).

Quebec ended up paying $31.6 billion MORE than what it received in equalization ($8 billion). Turning Quebec into a net positive contributor to the federal revenues.

If Quebec gets more equalization payments it is because it has a larger population than most provinces, except Ontario. In fact, equalization payments PER CAPITA in Quebec are less than most other equalization receiving province.

Quebec also used to have a large manufacturing base which, like Ontario, has been close to destroyed by outsourcing and the high dollar.

Ottawa's spending in Quebec

At the end of the day, Ottawa does spend more in Quebec than what it collects from that province, but people have to remember that Quebec has (among other things):

  • Several large army bases, one hosting CF-18 fighter jets on 24h readiness.

  • The CF center for armored vehicle maintenance and repairs in Long Point CFB.

  • The CF-18 maintenance and rejuvenation infrastructure in Mirabel.

  • Bell Helicopter and CF choppers maintenance centers.

  • The main Atlantic ice breakers base (Quebec city) from where the St-Lawrence river is kept open to the benefit of the West and Ontario (grain, manufactured goods and oil exports).

  • The St-Lawrence Seaway itself and its numerous bridges and locks which are situated inside Quebec, that benefits only marginally to the Quebec economy but benefit everything to the Great Lakes economy and the West.

  • The headquarters of NAV Canada that controls most of the flights between North America and Europe (yes including US flights).

  • The headquarters of the Canadian Olympic committee.

  • The headquarter of the Canadian revenue collection agency (Shawinigan).

  • Several historical sites and battlefields, Not Quebec's fault if the destiny of North America has played itself throughout the St-Lawrence valley.

And several other federal offices that could basically be in any province but get credited to Quebec without really providing any exclusive services to the people of Quebec (those services are dispensed throughout the Canadian population).

All of these spending must be accounted for when determining how much Quebec is really getting from Ottawa and why.

Alberta is not connected to any ocean, so it can't host any maritime organizations. Alberta is not in a strategic geographic position to control transatlantic or transpacific flights.

In the end, the extra money sent to Quebec has a lot more to do with its geographic situation and history than with "paying Quebec" for its laziness of some other nonsense like that.

/r/canada Thread Link - thestar.com