Mr. Speaker, I will be sharing my time with the member for St. John's South—Mount Pearl.
I want to make a few remarks on Bill C-24, an act to amend the Fiscal Arrangements Act. It is quite a complicated act, but what it means is that we are making some changes in Canada's equalization program.
Bill C-24 is quite timely given the current set of negotiations that are ongoing between the federal government and the Governments of Newfoundland and Labrador and of Nova Scotia regarding the division of offshore oil and gas revenues and how equalization could very well factor into all of that.
While Bill C-24 does not address that issue directly, it is nonetheless a bill that acknowledges that some changes are needed in equalization as it currently is and how it applies to various provinces in Canada.
First let me say that the Conservative Party views the current equalization program as an essential component of Canada's nation building. In order for Canada's provinces to grow and prosper, it is important that we have a good, strong equalization system in place and it is equally important that this equalization program effectively deals with the problems that have not provinces have. By striking a panel of experts to revisit the current equalization formula, the government has acknowledged that there are problems with the current formula.
We are pleased that the government has bowed to a little bit of pressure from the provinces to hold this review and we, in the Conservative Party, are eagerly awaiting the results of that review.
One of the drawbacks of the equalization program that I and my colleague, the member for St. John's South—Mount Pearl, have raised consistently over the past seven years has to do with the clawback of a province's non-renewable resource revenues by Ottawa through corresponding reductions in the equalization payments.
I do not know if all members are aware of this but at present, for example, Ottawa claws back 70% of Newfoundland and Labrador's provincial oil revenues. Under that kind of an equalization system, a province is prevented from economically drowning, as we are all aware, but the clawback effectively prevents that province from making any progress on its own. The clawback provisions so far have seen the lion's share of Newfoundland and Labrador's oil money, for instance, ending up in Ottawa.
When we were embarking on the oil industry in Newfoundland and Labrador, that was one of the reasons the province insisted on an extensive multi-billion dollar concrete production platform for its first oil field, which was Hibernia. If the province had gone through a cheaper Hibernia production system and more revenues, most of these revenues would have ended up in Ottawa. Knowing it would have had the money clawed back under the current equalization program, the province instead opted for jobs and industrial benefits.
The equalization clawback became a major election issue in Newfoundland and Labrador and Nova Scotia in the most recent federal election campaign. As a result of that, the Prime Minister and the Minister of Natural Resources called Premier Williams and promised that Newfoundland and Labrador and Nova Scotia would get to keep 100% of their offshore oil revenues without those revenues being subject to the clawback provisions of the equalization formula that we operate under today. At the moment of course we are waiting patiently for the Prime Minister to keep his election promise.
Unfortunately, the Minister of Natural Resources turned the province down and broke his promise and said essentially to the people of Newfoundland and Labrador that here were a few crumbs and that they could take them or leave them. That was his attitude.
We are hopeful that the Prime Minister will keep his promise because we already have a promise in writing from the minister who represents Newfoundland and Labrador in the federal cabinet, the Minister of Natural Resources.
Some observers of the June 28 election have been saying that the province should have received the Prime Minister's promise in writing. However, given that the Prime Minister had made his promise on prime time television, that was not a major consideration at the time. As I mentioned earlier, the Minister of Natural Resources did follow up on the Prime Minister's verbal promise and provided a written statement to the people of Newfoundland and Labrador, specifically to the people in his own riding. I have a copy of a flyer he sent out to people in his riding which states, “The Prime Minister has given me the responsibility of finalizing a deal on the Atlantic Accord as soon as possible that will bring Newfoundland and Labrador 100% of its offshore oil royalties without having any effect on the province's equalization payments”.
It could not be said a whole lot clearer than that.
I am at a loss to understand why the federal government, right in the middle of this equalization debate that is going on across the country, is dragging its heels on this issue and why the Minister of Natural Resources, who represents the province of Newfoundland and Labrador, would offer the people a few crumbs and tell them to take them or leave them.
I have spoken on a number of occasions to this particular issue because it is an important issue to the people of Newfoundland and Labrador. I feel in my heart of hearts that the Minister of Natural Resources should apologize to the people of Newfoundland and Labrador for breaking that promise. He should apologize to the people of Newfoundland and Labrador for his lack of concern for the struggle that Newfoundland and Labrador has had to undergo ever since Confederation to get its rightful place in the Confederation of this country. The minister, most of all, should apologize to the people of Newfoundland and Labrador for putting the party first instead of the province. He should be ashamed.
I have absolutely no reservation about standing here today to repeat in this equalization debate what I have said many times before since the promise was made by the Prime Minister of Canada to Newfoundland and Labrador. I have absolutely no reservations in saying to the Minister of Natural Resources that he should resign rather than break such an important promise to the people of Newfoundland and Labrador.
This is a very important issue and it gives the member for St. John's South--Mount Pearl and myself the opportunity once again to talk about the most important issue facing the people of Newfoundland and Labrador, and that is the broken promise of the Prime Minister and the broken promise of the Minister of Natural Resources concerning equalization.
As a result of that I feel very strongly that the minister should resign. The least he should do is apologize to the people for his broken promises and the fact that he would tell the people of Newfoundland and Labrador to heck with the promise and then offer them a few crumbs saying that they could take them or leave them.