Madam Speaker, I am pleased to rise on behalf of the Bloc Québécois to speak to a motion moved by our party, calling for the deletion of clauses 383 to 392 of Bill C-10. Those clauses would amend the Federal-Provincial Fiscal Arrangements Act, in other words, equalization. Bill C-10, the budget implementation bill, includes a change to the formula for calculating equalization. Under the new formula, Quebec's increase in equalization payments will be cut. This change will deprive Quebec of $1 billion in equalization payments in 2009-10. In these tough economic times, a billion dollars less in Quebec's coffers is a very significant loss.
The Bloc Québécois has led the fight in this House, on behalf of Quebeckers, against the fiscal imbalance between Ottawa and the provinces. The partial correction authorized by the federal government—as a result of the Bloc Québécois' efforts—involved changing the formula for calculating equalization. The federal government, supported by the Liberals, has unilaterally decided to deprive Quebec of $1 billion.
I had the opportunity to read the letter written by Quebec's Minister of Finance to the federal Minister of Finance. Ms. Jérôme-Forget—I will mention in passing that she is not in our political camp—wrote this letter on January 21, 2009. This demonstrates the importance of the Bloc Québécois in defending the interests of Quebeckers. I will read the beginning of her letter:
Dear colleague,
In recent days, authorities of the federal government, among them yourself and emissaries from your government, have said that all the relevant information on the changes you are considering for equalization were communicated at the federal-provincial meeting of Finance Ministers in Toronto last November 3.
That is incorrect. Allow me to set the record straight.
When such remarks are made by the Quebec Minister of Finance, all Quebec members in this House, whether Conservative or Liberal, should sit up and listen, as we have done. For the past few months, the federal government has kept us in the dark. It says that the provinces were aware of the changes to the equalization formula and that it was not a unilateral move, even though it was. Once again this is a unilateral change. The federal government is again avoiding settling the fiscal imbalance. It will deprive Quebec of $1 billion. I will come back to this letter.
It is important to understand. All too often, people wonder why the Bloc Québécois rises so often in this place to defend the interests of Quebeckers. It is simply because the federal government does not keep its word. Its failure to do so will cost Quebec $1 billion in 2009-10. That is quite significant.
Equalization is not unique to Canada. It is part of this confederation—we no longer know if it is a confederation or a federation. However, one thing is certain, equalization in Canada and in other countries such as Germany, Switzerland, Australia, India, Pakistan and South Africa, has a similar purpose. The United Kingdom also has an equalization system that takes into account the special needs of Scotland, Wales and Northern Ireland. This system results in a better division of wealth within a confederation or a federation. It ensures that the poorest provinces receive a contribution from the confederation or federation. Equalization helps to balance the finances of the provinces with weaker economies.
It gives us no pleasure to defend equalization. I would prefer that Quebec not have to benefit from the equalization system.That would mean that Quebeckers are better off than those in other provinces, which is not the case.
When we are told that Quebec is the spoiled child of the federation, that is obviously a myth, and I will give examples to prove it. Let us look at the amount paid per capita in 2008-09 under equalization: Quebec, $1,037; Nova Scotia, $1,679; Manitoba, $1,732; Newfoundland and Labrador, $1,781; New Brunswick, $2,111 and Prince Edward Island, $2,310. Once again, the equalization system is not equal in terms of the money received per capita in the provinces. This is why Quebec has been asking, for a number of years, that the equalization formula be recalculated in order to correct the fiscal imbalance. If a province is receiving equalization because it is not as rich as the other provinces, the amount should be more or less the same per capita. We are trying to restore this balance.
The Conservative Party has made economic mistakes. I think that reducing the GST was a mistake. Tax payers see very little gain, and it also deprives the federal government of $14 billion. When the government saw an economic crisis on the horizon, it did as it always has, cut transfers to provinces. That is the reality. Quebec will lose out on $1 billion in 2009-10.
Quebec's minister of finance referred to the new formula in the January 21, 2009, letter. In the concluding paragraphs of her letter, she said:
I also want to raise a matter of first importance for Quebec that was raised by the Premier of Quebec at the meeting of First Ministers last January 16.
On November 14, 2008, your officials advised their provincial counterparts that changes to the equalization regulations were under consideration. These changes were announced in the Canada Gazette on December 24, 2008. One of them concerns a change to the treatment of dividends paid by Hydro One to the government of Ontario. The federal government has decided to consider this source of revenue under the corporate tax base rather than the natural resources base.
The argument made by your department is that this enterprise transmits and distributes electricity, but does not produce it.
Clearly, that is important. The minister added:
However, all the dividends paid by Hydro-Québec to the Quebec government remain included in the natural resources base, even if a good portion of these dividends results, as is the case with Hydro One, from electricity transmission and distribution activities.
Once again, this would deprive Quebec of an additional $250 million. By changing the formula, the Conservative government decided to penalize Quebec yet again to the tune of $250 million.
I am worried because, once again, the Conservatives and the Liberals, political parties that have elected members from Quebec, are attacking Quebec. That is the harsh reality in this House. People are always trying to put Quebec down. As if by some unwritten rule, Ontario gets better treatment for Hydro One, and Quebec gets penalized. This will add to the fiscal imbalance that Quebec has to live with as part of this federation or confederation—no matter what people call it, nobody knows exactly what kind of arrangement it is supposed to be.
That is why, in election after election, Quebeckers have put their faith in Bloc Québécois members to raise these issues in the House of Commons and propose amendments, just as we have done with Bill C-10. We hope that all of the Quebec members in the House will stand up and vote for Motions Nos. 43 to 52, as proposed by the Bloc Québécois.