Madam Speaker, I too want to say a few words on the Bloc motion on Canada's fiscal imbalance, a motion which I do support. It has also been said that Newfoundland and Labrador has been the victim of too much money; too much money in Ottawa and not enough back home.
I think we all realize that over the last couple of days this whole business of the fiscal imbalance, as it applies to Newfoundland and Labrador, has been driven home quite well. Over the last few days we heard the Prime Minister of the country say to Newfoundland and Labrador “here is the deal, take it or leave it”, an offer that does not see the province get 100% of its resources. It is an offer that breaks, in a very significant way, the Prime Minister's promise to the people of Newfoundland and Labrador during the election campaign.
The people of Newfoundland and Labrador were offered, as all hon. members are aware, a $1.4 billion deal over an eight year period. If we failed to take that kind of a deal we were to have 100%, up to a $234 million cap, neither of which, incidentally, is 100%.
Given the current price of oil, which is more than $50 a barrel, the province's minister of finance has said to the people of Newfoundland and Labrador that if we were to sign that kind of a deal we would be leaving on the table billions and billions of dollars each year. I am given to understand that the people of Nova Scotia have rejected this offer as well, saying that it falls far short of what the federal government promised to the people of Atlantic Canada.
I want to give the House some idea of how far the deal falls short of what the Prime Minister actually promised to the people of Newfoundland and Labrador. For instance, in a year when the province takes in say $500 million in oil revenues, it would get to keep $234 million. That is less than 50%, which is a far cry from the 100% that we were promised.
Right now, after pumping oil for 10 years in Newfoundland and Labrador, the province only receives 14% of the revenues from its offshore oil while the Government of Canada and the oil companies get a whopping 84%.
Yes, what has been offered is an improvement in the current situation because wherein the lion's share of the offshore revenue is clawed back by Ottawa through reductions in equalization payments, but it is not 100%. Let us make no mistake about it, 100% of the offshore oil revenues is what the Prime Minister promised during the election campaign.
What happened between the Prime Minister's election promise and his very different written offer of October 14? Rising oil prices is what happened; rising oil prices and the unwillingness of the federal government to let any cash windfall accumulate in the economy of Newfoundland and Labrador.
The federal government is somehow of the opinion that if Atlantic Canada is kept dependent upon the federal government then come election time it will have a lever to use against the people in these areas. Somehow it is a positive and the government will be the recipient of the seats in Atlantic Canada by keeping Atlantic Canadians dependent on the federal government.
In his public statements during the election campaign, the Prime Minister talked only of Newfoundland and Labrador receiving 100% of its offshore oil revenues. However, with oil at more than $50 U.S. a barrel right now, the Prime Minister saw fit to introduce a few constraints on his election promise.
We are talking about a very complex issue here. I am convinced that the minister who represents Newfoundland and Labrador does not really understand the offer that has been made by the federal government. If the minister understood what the federal government was trying to do to Newfoundland and Labrador he would not be considered today, back in his home province, as the Benedict Arnold of Newfoundland and Labrador politics.
If the minister is listening, let me explain to him in 60 seconds what the federal deal is all about. The Prime Minister said that we can get 100% only until our province's fiscal capacity equals that of Ontario, but Ontario's fiscal capacity is based entirely on the performance of its economy. If the fiscal capacity of Newfoundland and Labrador were based only on the performance of our economy, we would be getting 100% of our offshore oil revenues forever and a day. It would never kick in.
However, what the Prime Minister has done in his offer, is he has artificially jacked up Newfoundland's fiscal capacity by adding in our current equalization payments and the modest offshore revenues that we get right now. He has added all that to our fiscal capacity to try to bring our fiscal capacity up closer to Ontarios. It artificially puts us closer to Ontario's fiscal capacity. It takes only a modest gain in offshore oil revenues to bring us up to Ontario's fiscal capacity, at which point the clawback provisions of the equalization act would kick in again and all our revenues would be flowing right back to the federal government.
Ontario's fiscal capacity is based on its actual revenues. However when the Prime Minister artificially jacks up our fiscal capacity by adding in our equalization payments and adding in the modest revenues that we receive in offshore oil revenues now, then our fiscal capacity comes very close to what Ontario has right now.
The Prime Minister made his offshore revenue promise at a time in the election campaign when things looked pretty bleak for the Liberals, when even our seven seats in Newfoundland and Labrador meant a whole lot to the Prime Minister of Canada.
Today I am calling upon our five Liberal MPs from Newfoundland and Labrador to take their lead from the provincial Liberal Party of Newfoundland and Labrador and the NDP of Newfoundland and Labrador which have both come out behind the Premier of Newfoundland and Labrador in his quest to get a fair deal for our province.
I give full marks to the Liberal Party provincially but I give zero marks to Newfoundland's federal MPs who do not have the courage of their convictions, do not have the courage to stand up for the Province of Newfoundland and Labrador.
We were never in a better position. We now have a minority government in the country. Before this time our seven seats meant nothing to the federal government because it always had 170 to 180 seats. Today, however, our five seats from Newfoundland and Labrador mean an awful lot to the federal government. The five Liberal MPs representing Newfoundland and Labrador can make or break the government if they want to use their clout effectively.
I am calling upon those five Liberal MPs to do what is right for the people of Newfoundland and Labrador. We have been the victim of the government for far too long. It has ruined our fishery and it has broken its promise on custodial management. Ten per cent of the people in Newfoundland and Labrador have moved out in the last six year period.
This is our only chance to get a fair deal in Confederation. How dare the Prime Minister of this country tell the people of Newfoundland and Labrador that they can get 100% of their offshore revenues, and then turn around and do something different. This is not fair to the people of Newfoundland and Labrador. The five members will pay if something is not done to make this deal a fair one.
