Madam Speaker, the situation is very dramatic for Newfoundland and Labrador. I invite hon. members and the public of Canada to consider the fact that Newfoundland and Labrador, despite the fact that it is on the verge of have status and has reached have status depending on the price of oil, still has the highest per capita debt in all Canada. It has the highest unemployment rate in all Canada by provinces and has the lowest per capita income.
In Newfoundland and Labrador the net per capita debt, as of March 31, 2008, was in excess of some $21,000, $22,000 per person. The next nearest province is at about $14,000, and that is the province of Quebec. The all province average is $10,000, so Newfoundland and Labrador's per capita debt is more than twice the all province average.
With this budget, in one action behind the scenes, the government has not changed a word of the accord, but it has changed the formula for calculating payments to provinces under the offsets under the Atlantic accord by changing the equalization formula, and that results in a $3,000 per capita hit over the next three years for Newfoundland and Labrador.
That is shocking, it is outrageous and it is not a Canadian budget. It is not the Canadian way to say to the newest province in Canada that this is how it will be treated by the Government of Canada. It will give us this body blow, taking away the ability of the province to continue to do the kind of things that need to be done.
Over the last number of years, the Government of Newfoundland and Labrador has been reducing its per capita debt, thanks to the oil revenues and thanks to the 2005 Atlantic accord. Two billion dollars flowed to Newfoundland and Labrador under that accord. That was used to reduce the government's obligations, the unfunded pension liability, reducing the province's per capita debt by a significant amount, bringing it down.
The people of Newfoundland and Labrador have not had the kind of government measures they need. The provincial public servants had their wages frozen for two years and a very modest increase imposed on them after a strike several years ago. Nobody is flush with cash in Newfoundland and Labrador as a result of the transfer payments. The money is being used to try to reduce the provincial debt and to bring Newfoundland and Labrador services and incomes up to the national average, to fight poverty and to do the things that need to be done.
Here we have a government suggesting that the proper response in the budget, which is supposed to be stimulative and recognize that people are hurting and has the means to provide stimulus and get involved in the programs and infrastructure by being able to pay its share, is saying it will cut us off.
This is wrong and I ask all hon. members to recognize that. I ask the government to change this policy and to announce as soon as possible that this will not go forward.