[BRIEF NOTE] "PBO says Ottawa is shortchanging Ontario"

[rfmcdonald]

I noted back in 2008 that Ontario, its economy beset by slow growth and deindustrialization, was set to become a have-not province, a net receiver of funds from the federal government to . (This happened in 2009.) MacLean's now shares news that apparently Ontario might be short-changed.

This will not serve the Conservatives well come election time, I think.

The Parliamentary Budget Officer says changes to federal equalization payments makes Ontario the big loser among provinces, while Quebec, Nova Scotia and New Brunswick gain double-digit increases.

The report finds total equalization payments transfers from Ottawa to the provinces and territories rose about 3.5 per cent this fiscal year.

But the distribution is wildly different from province to province, with Ontario seeing a 37.3 per cent decline, or about $1.2 billion.

Meanwhile, Quebec will see transfers under the program increase 17.5 per cent, Nova Scotia, 11.5 per cent, and New Brunswick by 10.2 per cent.

The report notes that the federal government this year chose to stop a program ensuring no province receives less in a given fiscal year in combined transfers than it received in previous years.

The PBO says Ontario would have been the only province to qualify in 2014-15, hence has missed out on $640 million in revenues.

The Ontario Liberal government has been vocal in complaining that Ottawa is shortchanging the province, but the federal government has said it has been fair in calculating transfers.

During the election campaign that delivered Premier Kathleen Wynne a majority government last week, the provincial Liberals accused Ottawa of slashing Ontario’s latest share of equalization payments by $641 million.