Mr. Speaker, the federal carbon pollution pricing system is not about raising revenues. lt is about recognizing that pollution has a cost, empowering Canadians and encouraging cleaner growth and a more sustainable future. That is why for provinces that have not committed to pricing carbon pollution, the federal government will return the majority of direct proceeds from the regulatory charge on fuel in the form of climate action incentive payments directly to individuals and families in the province of origin.
Climate action incentive payments enable the government to encourage lower greenhouse gas emissions without imposing a financial burden on households. ln Saskatchewan, these payments are estimated to be worth $305 for individuals and $598 for a family of four in 2019, rising to $731 for individuals and $1,459 for a family of four by 2022. Additional top-up payments will be available to address the additional burden placed on individuals in small and rural communities.
Additionally, a smaller portion of funds collected through the backstop in these four provinces will be used to fund programming to help small and medium-sized businesses, not-for-profit organizations, municipalities, universities, schools, hospitals and indigenous recipients reduce their energy usage and greenhouse gas emissions, while also saving on energy costs.
Under the Greenhouse Gas Pollution Pricing Act, the federal carbon pollution pricing system has two parts: a regulatory charge on fuel, and a regulatory trading system for large industry called the federal output-based pricing system. The federal output-based pricing system is designed to ensure there is a price incentive for large industrial emitters to reduce their greenhouse gas emissions and spur innovation while maintaining competitiveness and protecting against carbon leakage.
The federal output-based pricing system went into effect on January 1, 2019, in Ontario, Manitoba, New Brunswick, Prince Edward Island and partially in Saskatchewan. Saskatchewan has proposed a pricing system for some of its industries based on an output-based performance standards approach. The federal OBPS will fill in the gaps in that province by covering the emission sources not covered by Saskatchewan's system, for example, the electricity and natural gas transmission pipeline sectors.