- The federal government budget for 2020-2021 includes almost $13.3 billion in equalization payments for Quebec and several more billion for Maritime provinces, Manitoba, and the territories.
- Scott Moe, Premier of Saskatchewan, took to Twitter to decry the system.
- Many of his followers have stated that the payment system gives an unfair advantage to Quebec.
The Government of Canada has released its equalization payment amounts for 2020-2021 which has once again put Quebec under the microscope. Many provincial premiers and members of the Canadian public are not happy about Quebec's $13.3 billion dollar cut of the payment pie. In fact, Quebec has the lion's share of Canada's provincial equalization payments, which total to $20.6 billion in 2020.
The rest of Canada is understandably confused about Quebec's large share of equalization as the province reported a $4 billion dollar surplus thanks to a relatively strong economy.
Saskatchewan premier Scott Moe has called for changes to the fiscal stabilization program to address issues of inequality in federal payments.
Across the country, many are calling 2020's equalization payments unfair and unreasonable.
Understanding how equalization payments work is crucial to knowing how Quebec is eligible for such a huge amount.
According to the Library of Parliament, equalization "assesses a province’s ability to generate own-source revenues and compares that fiscal capacity to the average fiscal capacity for all provinces."
The equalization formula exempts provincial fees for the use of public services and allocates provincial government revenue to five categories: personal income taxes, business income taxes, consumption taxes, property taxes, and natural resource revenues.
It's slightly complicated, but the basic concept is that the federal government allocates certain amounts of money to assist provinces that don't equal ability to provide services based on the province's fiscal capabilities.
While the rest of Canada is baffled at Quebec's equalization amount in 2020, keep in mind that no one in the province is celebrating this either.
Perhaps no group is more disappointed with Quebec's high Equalization in 2020 than the CAQ.
The provincial government's opinion is that high equalization payments are somewhat of an embarrassment.
During his campaign for premier, the CAQ's François Legault said that his party will aim for "zero equalization" and will "eliminate the wealth gap with the rest of Canada."
Equalization payments have been a hot-button issue for those in provincial governments across Canada.
Where misunderstandings happen is that many in the rest of Canada believe that Quebec is taking advantage of the country whereas some in Quebec, itself, see high equalization payments as proof the province's economy is doing poorly.
No matter where you go in this country, it seems that no one is happy about Quebec's $13.3 billion equalization package in 2020.
Critics from outside Quebec have called the provincial government and its people "beggars" who are "addicted to welfare" but the reality is that few in Quebec are pleased about the payments.
Provinces that receive no equalization payments tend to have a larger population of young people and high-income individuals, which are keys for economic prosperity.
Alberta and Ontario are prime examples of this. Although Quebec's economy is slowly revitalizing itself, it still has ways to go to be on par with Canada's big economic provinces.
And while the rest of Canada continues to take shots at Quebec, those living in the province are still struggling with an economy that's agonizingly slow to improve. Despite a budget surplus, Quebec still has a long road to economic prosperity.
It's easy to take shots at Quebec and its people, but Canadians should understand all aspects of the issue before going on racially and culturally motivated anti-Quebec rants.