Mr. Speaker, I appreciate this opportunity to assure Nova Scotia and Newfoundland and Labrador with this answer.
As the member knows, both provinces can rest assured that the exceptional treatment afforded under their offshore accords is secure.
Our Conservative government's cumulative best-of guarantee is in no way affected by recent changes announced in November that put equalization on a more sustainable long-term footing. As has always been the case with equalization, the amount each receiving province gets depends on its fiscal capacity relative to other provinces.
As a rule of thumb, a province growing faster than the national average might see a decrease in equalization while a province growing less than the national average could see an increase. As a result of their offshore accords, additional offset payments are made to Nova Scotia and Newfoundland and Labrador based on how much equalization they would have received if they had no offshore revenues bolstering their respective fiscal capacities. These payments will continue without change.
These provinces also benefit from our government's cumulative best-of guarantee. This ensures that they will do at least as well under the new O'Brien-based system on a cumulative basis as they would have if they had remained under the old equalization system that was in place when the 2005 accord was signed.
The cumulative best-of guarantee and the 2005 equalization accord system are not touched by the November announcement. The Minister of Finance guaranteed that no equalization receiving province's equalization payments for next year, including offshore accord offsets, would go down as a result of his November announcement. Even though Nova Scotia would normally have received less because it had been doing relatively better than other provinces, its total payments in 2009-10 will be held to the same level as 2008-09.
In addition, if total cumulative payments to Nova Scotia fall below the payments the province would have received under the 2005 equalization system, the province will receive an additional guarantee payment.
I understand the member knows all this already. Reading from the November 22, 2008, St. John's Telegram the member was “welcoming the news that the Atlantic Accord agreements will not be impacted by a recent change to the equalization program”. The member also knows that federal support to Nova Scotia has increased during our government, and will continue to grow. He knows total federal support for his province reached $2.7 billion in 2008-09, a $363 million increase over 2005-06.
The member knows Nova Scotia will receive $1.5 billion in equalization and accords offsets alone next year, a 14% increase above the Liberal government. The member also knows Nova Scotia will benefit from an initial crown share settlement payment of $234 million this year, something the previous Liberal government refused to do.
I hope the member will stand up for Canada and oppose handing our government over to the separatist-backed coalition attempting to seize power.