Madam Speaker, my colleague from Stoney Creek does not follow the argument because he did not listen to it.
With respect, I said explicitly that I did not believe for a moment that any provincial finance minister sat down and contrived ways not to generate economic or revenue growth in order to avoid the reduction in federal equalization payments that might result.
However, I said that it does put them in a difficult position. Let us take one concrete example.
The province of Quebec maintains substantially lower corporate tax rates than the province of Alberta. I am all in favour of tax competition in the federation. I think it is great. The problem is that if the Quebec finance minister raises that tax rate he will likely lose a corresponding amount of revenue or even more revenue out of the federal equalization transfer. So he is much less likely to make that policy change, which means that essentially Alberta, Ontario and B.C. businesses are subsidizing artificially low corporate tax rates in the province of Quebec.
I am not suggesting that the provinces should end up constructing their entire fiscal and economic policy to avoid a reduction in federal transfers. I am saying that we are creating a perverse incentive and it is not a good thing. If we move in the direction that I am advocating, which is to create a system of transfers that are sensitive to individuals and their income regardless of the accidents of geography, that would avoid the kind of disincentives which exist in the current system.