Mr. Speaker, it is very interesting to listen to the Liberals opposite try to create a parallel universe based on the facts as they would wish them to be for politicking purposes, but not on the facts as they are.
The members opposite rightly point out that their government signed Atlantic accords with the provinces of Newfoundland and Labrador and Nova Scotia. This was a problem for them because all of a sudden some provinces had side deals, which completely destroyed the fairness and the equality of this program. Nevertheless, the Liberal government, for political purposes, entered into these agreements and our government said that we would honour those agreements.
This is the crucial point, and I hope members opposite are listening to this, because this is a fact that may assist them as they continue to pontificate and mislead through the day. Here are the facts that they should be keeping in mind.
I read from the budget document, which any citizen of Newfoundland and Labrador, or any citizen of Nova Scotia, or any citizen of any province can look at it on the website. It is in black and white and in plain English and French.
This is what the budget says, “To respect the offshore accords”. The budget does respect the offshore accords. “Nova Scotia and Newfoundland and Labrador may continue to operate under the previous equalization system”. That is what the budget says. The budget also says:
This fulfills and builds upon the Government’s commitment to respect the Offshore Accords and ensures that these provinces will continue to receive the full benefit that they are entitled to under the previous system.
The accords are fully and completely respected by the government. There are no exceptions, no exclusion, no caps, no changes. That is the truth. That is it. There is no change.
For those provinces there is actually a happy choice. If they no longer like the Atlantic accords, they can have another choice. Again, by the previous government and finished by our government, the equalization system has been fixed.
In fact, the previous government put together a blue ribbon panel, the O'Brien panel, to examine the equalization system, which had been badly broken and bent by years of Liberal mismanagement. The previous finance minister, the member for Wascana, said:
There are so many arguments among the provinces about what the right formula ought to be, that we will engage an independent panel of experts—people who don't have a particular bias, don't have any kind of regional, vested interest—and have them come up with recommendations for how the distribution formula ought to be changed...
The former Liberal finance minister said, “The main focus of this panel will be how to address non-renewable resources”.
The panel did its work. The panel, set up by the Liberals, reported and our government fully accepted the recommendations of the O'Brien panel. We have now fixed the equalization system according to the recommendations of this independent, unbiased panel set up by Liberals.
Because of the fixing of the system, the equalization program has been somewhat enriched. Now Newfoundland and Labrador and Nova Scotia are saying that the accords gave them one thing but this new system might give them something better. That may be true. What did our government do? Our government told those provinces that they had a choice. They could continue to operate under the accords which they negotiated and signed and which we are fully honouring without any exceptions, or if they wished, they could move to the new system.
What could be fairer than that? What could possibly be fairer than saying they can get the agreement they fought for and signed, or they can move into the new system. It is up to them. They have a choice. I might add that other provinces do not have a choice, but those two provinces do have a choice.
Let us talk about the new system that has been set up. The new system actually gives a choice to the provinces that are in the new system, which Newfoundland and Labrador and Nova Scotia could be if they want to be. The new system says that for every year, two calculations will be made for the provinces. One calculation will be based on the O'Brien recommendations that 50% of non-renewable resources will be included in the formula. That is what O'Brien said was fair and reasonable and right, so we will calculate on that basis. Where a province wants to have 100% exclusion of non-renewable resources, we will make a calculation on that basis too. Provinces can choose which one they want. They will get the best of those two calculations.
Actually, the provinces of Newfoundland and Labrador and Nova Scotia get three choices. They can choose to have equalization under the Atlantic accords, which are fully respected and open to them and honoured by this government, or they can choose the O'Brien formula based on 50% inclusion of non-renewable resources, or they can choose the best, if it is the best, of 100% exclusion of non-renewable resources. Yet, dishonestly I say, members opposite are trying to say that somehow the provinces that are given not one choice, not two choices, but three full choices are somehow being unfairly treated. That is so untrue.
Not surprisingly, when provinces are given a formula, there is going to be some unhappiness. The leader of the Liberal Party himself said just in January of this year that every province is arguing about getting shortchanged by Ottawa in one way or another and it would be difficult to make “all the premiers smile”. Did he ever get that one right.
The leader of the Liberal Party also said that we need to have a clause that says whatever is the formula of equalization payments, a province that received equalization payments cannot see its fiscal capacity going above the fiscal capacity of a province that does not receive equalization payments. There we go. It is called a cap.
That is exactly what the O'Brien panel said and what the new equalization fix put in place by our government delivers. This is a program to make sure all Canadians get an equal level of services, but provinces that are not receiving equalization cannot have a lower ability to provide their citizens with services than provinces that do receive equalization. It has to be fair for everybody. It has to be the same standard for everybody, whether it is called a cap or a same standard, or whether it is called equality or fairness.
That is a principle that all Canadians get except a few members opposite. Even the Leader of the Opposition gets it. I will read again what he said, “cannot see its fiscal capacity going above the fiscal capacity of a province that does not receive equalization”.
The formula, the equalization program has a standard that all provinces honour because that is fair. Provinces that get money from the equalization program are not going to have a better ability to serve their citizens than those who do not get money from the equalization program. What is there about that that the members opposite who just spoke do not like? Even their leader gets that; even their leader affirms that.
We have fixed the equalization system. I might add that here we have a system that has been gerrymandered, skewed and torn up by the previous government that could not make up its mind, could not stick to principles, could not make a strong decision. The Liberals could not do it, so we did it and now they do not like it, even though it is fair, even though we fully honoured the Atlantic accords and even though the new system gives provinces the best-of choice of two calculations. Somehow the members opposite do not get it and they are making trouble simply for political purposes where no trouble should be given. That is completely and utterly unfair.
What do Newfoundland and Labrador and Nova Scotia get from this enriched equalization program? They get full respect, no changes whatsoever to the Atlantic accords.
The new equalization system makes every single province better off. In fact, we have been criticized for how rich the equalization system is under the new formula. Over $12 billion will now be distributed to the receiving provinces under this formula. If Nova Scotia and Newfoundland and Labrador decide they are better off under this new enriched equalization program, they can opt into it. It is their choice. What can be better than a fair choice? Any time they want to during the life of the accord they can move to the new enriched system.
I want people in Newfoundland and Labrador and Nova Scotia to remember two things out of this debate. One is that the Atlantic accords that were signed are fully honoured and are available to those two provinces with no change whatsoever. The second thing is that we have a new system, a richer system, a system that will allow any province to receive benefits under a calculation that fully excludes non-renewable resources, or under a system which O'Brien recommended, a calculation that will include half of the non-renewable resources.
That is justice. It is clear. It is fair. It gives the provinces some certainty going ahead as they calculate their budgets, as they decide how best to provide to their citizens important services like health care, education, infrastructure, child care and social support systems for the most vulnerable. That is what the fixing of the equalization system is all about.
There are two provinces, one with the highest fiscal capacity in Canada, Alberta, and one with the lowest fiscal capacity in Canada, Prince Edward Island. What do these two provinces have in common? Their premiers are reasonable people. They know a reasonable accommodation when they see it. The premiers of these two provinces, one the newest premier and one the longest serving premier, are very pleased with this budget because we kept our promise to fully preserve the Atlantic accords and we restored fairness and balance to a disjointed system that we inherited from the directionless, knee-jerk government that Canada suffered under previously.
On top of that, the Prime Minister, the finance minister and this government recognize that a national government has a duty to all of Canada, to every province, every territory and every citizen, to be fair, to be equal and to have the same standards for everybody. This is something the previous government did not get.
It is essential to fairness that the provinces receiving equalization do not have a higher fiscal capacity than non-receiving provinces. That is what the O'Brien panel, which was set up by the previous government, said. It is what Canadians know to be fair, and that is what this new system puts into place.
Regarding all the distortion, all the misrepresentation, all the trouble making on the other side, members of Parliament are supposed to make this country work well for everybody. They are supposed to be fair, honourable and upright in the way they disagree. If the members opposite do not like the equalization formula that the Conservatives put into place and think they could do better, though we notice they never said how they would change it, then that is a fair debate. However, to misrepresent what was done, to say that promises were somehow broken when they were kept is completely unfair and deceitful to the people of this country who depend on their members, because their constituents listen to them. They believe their members and trust them.
Trust should be placed on the basis of truth, honesty and putting forward the facts as they actually are, not as what members opposite might want them to be so that they can attack a government that has it right for a change, that is keeping its promises and giving provinces not one choice, not two choices, but three clear, unambiguous choices. I hope as the debate continues today that it will be based on the truth. I hope it will be based on what is actually in the budget. I hope it will be based on what is actually before the good people of Newfoundland and Labrador and Nova Scotia because they deserve to make their assessment on what is true and actual, not a distortion of it.
I have tried to be as clear as I can to the House and Canadians about what is really happening: fixing the equalization system, fully honouring the Atlantic accords if the two provinces want to stay with them, fully honouring the commitment to provinces who want to exclude 100% of non-renewable resources, but at the same time honouring the O'Brien panel which spent many months making the best accommodation that can be made for our country for fairness, equality in provision of services to citizens.
This is where we are. We have a good system. It is not a system everyone is going to like because that is not human nature, but it is a system that is true to our promises, true to the choices that we said would be made, and true to fairness and the same standard for everyone at the end of the day.
Citizens in Newfoundland and Labrador, citizens in Nova Scotia are good Canadians, Canadians who want a fair deal for themselves and their children and services that they can count on. They want certainty but also to be part of this great country where there is equality for all.
We are glad to honour the deals that were made by the previous government even though they skewed the system. We recognize that but we will still honour them or move into an enriched system that gives an even better deal. That is what we are providing for people in these two provinces and all Canadians. We are proud of it and we hope that it will be supported by everyone.