Madam Speaker, equalization is one of those arcane debates where not only members' but the listening public's eyes tend to glaze over because it tends to get very complicated and controversial. However, it is worthwhile to lay out what equalization is for our listening audience, if we have one, which I think we do, and maybe for some of our members to remind them what equalization is all about.
Equalization is a constitutionally entrenched program which allows all provinces to offer “reasonably comparable levels of public services at reasonably comparable levels of taxation”. Its goals are “to promote equal opportunities for the well-being of Canadians, furthering economic development to reduce disparity in opportunities, and to provide essential public services of reasonable quality to all Canadians”.
It is a fancier way of saying sharing the wealth with other areas, which is truly one of the unique features of Canada. We cannot say that for all countries. We cannot even say that for our neighbours to the south of the border despite the fact that they do a number of things well. Equalization is unique to Canada. We have to be very proud of it, but obviously it is ridden with its problems and difficulties. We are always trying to strike a balance that works at both the federal and provincial levels.
I want to point out what some of the premiers are saying, and then I will go on to our position as a federal party. The province of P.E.I. is an example. We have heard from Nova Scotia and Newfoundland today in the House, but I wanted to point this out because Newfoundland is obviously missing members of Parliament on the Conservative side. I guess we will have to work on that problem in the next election.
The treasurer from P.E.I., Mitch Murphy, is suggesting that cuts to equalization payments may be unconstitutional. He suggests that those cuts to equalization, what we are hearing now and his up to date figures, would indicate an additional $25 million loss, which would bring the total loss in revenue to P.E.I. in the next year to something like $78 million, a substantial amount of money. In my home province of New Brunswick, the premier is looking at a loss of about $100 million this fiscal year if the current formula holds.
What we are discussing now is Bill C-24. Bill C-24 is a bill that would bring in some changes to the arrangement, but I want to put on the record where we stand on it as a party, the Conservative Party of Canada. The Conservative Party of Canada views the equalization program as an essential component of Canada's nation-building efforts. In short, we support it in order for Canada's provinces to grow and prosper. It is important that a strong and effective equalization program be in place.
We accept some of what is in Bill C-24 because in fact the government accepted some of the ideas that we have thrown out during the election period and right here on the floor of the House of Commons. Bill C-24 addresses some of the concerns shared by the Conservative Party of Canada, the provinces and territories, notably the provisions for additional federal equalization and TFF, territorial funding formula, and a structure that sets the total level of funding going forward, not backward. These changes are an admission by the Liberals that their methods are flawed, were flawed in the past, and that the Conservative Party and the provinces have been right in calling for changes. Some of those changes again are inherent in this bill.
Unfortunately, Bill C-24 does not address how the equalization and TFF will be allocated among the provinces and territories from 2006-07 forward. We have to look into the future. One of the things we are suggesting, which again is in this bill, is that it examine the report or the future funding levels through a panel of experts. The government is doing that and it has bowed to some of the pressure we have put upon it to do that very thing. At the end of the day, the federal Liberals will retain the ultimate decision-making in the equalization formula. Although the panel of experts is a step in the right direction, at the end of the day the government will basically call the shots.
Again what I am suggesting is that the government is putting its own political agenda ahead of the provinces and the need for a fair and sound formula. Then there is the other point I want to make about what it does not address. This is a point that the members from Newfoundland and Labrador point out every time they are on their feet on this side of the House, although there is an absence of that on the other side of the House in terms of debate.
Our members from Newfoundland and Labrador and Nova Scotia consistently have talked about the inclusion of non-renewable resource revenue in the current equalization formula. Under the current formula, provinces that benefit from non-renewable resource revenues are subject to a clawback that results in lower equalization payments. We are saying that this should be included in the bill. We support the ending of that clawback so there can be no disagreement.
As you know, Madam Speaker, although your riding is far removed from Newfoundland and if I am not mistaken is in the heart of Ontario, during the election the Prime Minister made that promise in Atlantic Canada. He did that when the bottom was falling out of his campaign and he did it for one reason only: votes. It is very simple.
In the middle of the election he made a promise to the Canadian people, particularly those in Newfoundland and Nova Scotia, for votes. As some members have already mentioned, we probably should have had the Prime Minister put that in writing and sign it. But he is on the record. He was on national television. He went over there and made that promise to resurrect Liberal fortunes on the Island, in Nova Scotia and in Atlantic Canada in general, and he has reneged on those promises. That is wrong.
In terms of the Conservative Party policy, we have four recommendations.
The first is to allow reforms in the 2004 budget to take effect.
The second is to provide a formula driven approach. We have always been in favour of a formula driven approach that works and is consistent.
The third is to provide incentives for sustainability by carving out resource revenue from the equalization formula. I have spoken on that previously.
The fourth is to remain committed to the five year renewal schedule.
I believe that we can do better, as I have pointed out. I will leave my arguments at that and look forward to questions and comments from my colleagues.