Mr. Speaker, the member for Cape Breton—Canso doubts that we have honoured our commitment to Nova Scotia's offshore accord and the treatment of natural resources in the equalization formula. As he said, he has put that position forward before.
There is some discussion surrounding the accord, the member is aware of that, between the federal government and the government of Nova Scotia. It is important to remember, and sometimes this gets lost in the shuffle, that budget 2007 provides important benefits to the people of Nova Scotia as part of our commitment to fair and equitable financial support for provincial and territorial health care delivery, post-secondary education, child care, social programs and infrastructure.
In specific terms, our budget will allow the government of Nova Scotia to continue to enjoy the benefits of its 2005 offshore accords, in recognition of the province's economic and fiscal circumstances.
This will provide the province with offset payments that are equivalent to the reductions in equalization that would normally arise from its increased fiscal capacity from offshore revenues. These are available only to Nova Scotia and Newfoundland and Labrador.
Indeed, budget 2007 honours Canada's new government's commitment to respect the offshore accords by allowing Nova Scotia to operate under the existing equalization formula for the life of the accords, and the member knows that, and there is no cap in that formula.
Nothing in budget 2007 changes these facts. The benefits from the existing Atlantic accords and the equalization system will continue to flow to Nova Scotia.
Nova Scotia can operate under the existing equalization system or it can choose to opt into the new system based on the O'Brien report, if and when the province determines this as being advantageous. By having this additional choice, Nova Scotia potentially stands to receive even higher benefits than under the existing system, while retaining its right to offset payments under the accords.
If Nova Scotia's government chooses the new equalization system, however, we believe that it is fair that the whole package would apply, including the fiscal capacity cap that is an integral part of the new equalization system. It would not be fair to other provinces if only Nova Scotia were allowed to choose those parts of the new equalization program that benefit the province. The equalization program should be a national, principles based program.
Finally, Nova Scotia has been given additional flexibility beyond what was set out in budget 2007. Budget legislation introduced in Parliament will allow Nova Scotia to benefit from the O'Brien report for 2007-08 and provide more time to assess whether it wants to permanently opt into the new equalization formula.
This option has given Nova Scotia an additional $95 million, for total benefits of $1.5 billion in 2007-08. Under this arrangement Nova Scotia will receive its fully offset payments under the offshore accords.
The facts show that this government is keeping its word. The offshore accords are being respected. We are delivering on our commitments to the people of Nova Scotia.
If the member does not believe me, maybe he should read today's Halifax Daily News, which states:
But here in Nova Scotia, we really have nothing to complain about...And even under the new formula, we still get 50 per cent of resource revenue, plus the richer equalization stipend. Folks, there is really nothing about this not to like--