Madam Speaker, I thank my friend and colleague from the other side for his continued questions and his passion for ensuring that his province is treated the same as every other province.
I just want to mention that today is a sad day for Nova Scotia. On this day, we mark with sadness the passing of a great Nova Scotian. I would like to convey my respect and condolences to the family and friends on the passing of the Hon. Michael Baker, Minister of Finance for Nova Scotia, after a long and courageous battle with cancer. Our thoughts are with his wife, Cindy, and his sons, Matthew and Daniel, at this time.
On behalf of the Minister of Finance, I wish to read his statement on Minister Baker's passing:
I had the good fortune to work with Michael, both in cooperation with Canada's other finance ministers to address the collective challenges facing our nation, as well as directly in our efforts to secure a resolution to the long-standing Crown Share payment issue for the people of Nova Scotia.
In all cases, Michael advanced the interests of Nova Scotia and Canada with the utmost respect for his constituents and colleagues, a profound appreciation for our parliamentary traditions and a great sense of personal responsibility for securing his home province's prosperity. His passing marks a tremendous loss for his family, his friends, his province and our country.
I will now address today's question. I want to assure the member that Nova Scotia's cumulative best-of guarantee is untouched by budget 2009 equalization changes. This means that Nova Scotia will receive at least as much equalization and offset payments on a cumulative basis as it would have under the system that was in place when the 2005 accord was signed.
On top of that, it will receive $1.5 billion of equalization and offset payments combined for 2009-10, along with a $74 million transitional adjustment payment, ensuring payments to the province are the same as 2008-09, despite the fact that Nova Scotia's fiscal capacity has grown significantly. This payment is legislated through Bill C-10, the budget 2009 implementation act. It is referenced on page 335 of that document.
In subsequent years, total equalization payments under the new O'Brien based system will grow in line with GDP on a three year moving average. The amount each province gets will depend on its fiscal capacity.
For example, a province growing faster than the national average might see a decrease, while a province growing less than the national average could see an increase. However, Nova Scotia was provided with what has become known as the cumulative best-of guarantee. This guarantee ensures that Nova Scotia will do at least as well under the new O'Brien based system, which Nova Scotia has opted into on a cumulative basis, as it would have if it had remained under the old system that was in place when the 2005 accord was signed.
The cumulative best-of guarantee and the 2005 equalization and accord system are not touched by the equalization changes in budget 2009.