MONTREAL (CP) - Dalton McGuinty came under fire Wednesday from his fellow premiers after asserting that Ontario can't afford to give more money to poor provinces.
The Ontario premier did not attend the second day of meetings with his colleagues but he left some ruffled feathers in his wake after rejecting Tuesday a provincially commissioned report on the so-called fiscal imbalance. Prince Edward Island's Pat Binns said McGuinty's position is "obviously a problem for Canada."
"It's disappointing that Ontario, the big brother of Confederation, would take this kind of a position," Binns told reporters.
The report called on the federal government to fork over an additional $4.9 billion a year in transfer payments to the provinces for health care, education and social assistance, plus another $4.7 billion a year in equalization payments to have-not provinces.
Equalization is a constitutionally enshrined program aimed at ensuring poor provinces can offer similar services at taxation levels comparable to those of the wealthy provinces.
Premiers and territorial leaders normally issue a joint communique at the end of their meetings. But McGuinty departed from precedent Tuesday, isssuing his own blunt statement objecting to any further increases in equalization.
He noted that equalization has grown by 30 per cent over the past four years and that the program is already designed to grow by a further 3.5 per cent each year.
"Enhancing equalization again - beyond the growth currently anticipated - is something Ontario taxpayers just can't afford," McGuinty said.
Ontario, Alberta and Saskatchewan are the only three provinces that do not receive equalization. McGuinty contends that any additional cash from Ottawa must benefit all provinces equally. He would prefer enriched transfer payments that are distributed strictly on a per-capita basis.
"We won't support a solution that helps half the population at the expense of the other half," he said.
However, Quebec Premier Jean Charest disputed the notion that Ontarians are being asked to pay more for equalization. The increases can be funded from surpluses already being amassed by Ottawa without any hike in taxes, he argued.
At a closing news conference Wednesday, Charest produced a chart showing that equalization payments, as a percentage of the size of the national economy, have shrunk over the past few years to an historic low of less than 0.7 per cent from an average of 1.1 per cent.
Binns acknowledged that Ontario taxpayers contribute most to the federal treasury. But he argued that's because the province is wealthy, due in part to federal policy that has ensured Ontario is the country's manufacturing centre.
"If we're going to have a Canada long term, we need (equalization). We can't have the big brother of Confederation sort of taking the car and the credit card and leaving those with less resources in the family behind if the country is going to work."
Some premiers didn't disguise their annoyance over McGuinty's decision to issue his own statement.
"We just haven't seen this before," Binns said. "It's disappointing."
Manitoba's Gary Doer echoed that sentiment.
"I'd prefer one communique," Doer said.
Doer said McGuinty should live with the conclusions of the report crafted by an blue-ribbon panel, noting that "Ontario agreed to the expert panel and they chose the co-chair."
"One of the reasons we established the panel is 13 of us couldn't agree to begin with," Doer added. "So we established an expert panel and I believe we should accept the recommendations and not cherry-pick the parts we like and the parts we don't like."
In objecting to any further increase in equalization, Ontario appears to be isolated.
On Tuesday, British Columbia's Gordon Campbell made a point of declaring that McGuinty was not alone in his criticism of the report.
But on Wednesday, Campbell hedged when asked specifically if he agreed that no more money should be pumped into equalization.
"I think too often this discussion is about who is taking what from whom," he said.
Campbell said any resolution to the imbalance must address both the fiscal disparity among provinces and the disparity between the federal and provincial levels of government.
However, Charest insisted Ontario is not isolated, stressing that discussions on the imbalance have only just begun.
"The issues are complex and our interests are not identical," he acknowledged.
But Charest insisted "an honourable compromise" will eventually be reached.
http://start.shaw.ca/start/enCA/News/NationalNewsArticle.htm?src=n041293A.xml
The Ontario premier did not attend the second day of meetings with his colleagues but he left some ruffled feathers in his wake after rejecting Tuesday a provincially commissioned report on the so-called fiscal imbalance. Prince Edward Island's Pat Binns said McGuinty's position is "obviously a problem for Canada."
"It's disappointing that Ontario, the big brother of Confederation, would take this kind of a position," Binns told reporters.
The report called on the federal government to fork over an additional $4.9 billion a year in transfer payments to the provinces for health care, education and social assistance, plus another $4.7 billion a year in equalization payments to have-not provinces.
Equalization is a constitutionally enshrined program aimed at ensuring poor provinces can offer similar services at taxation levels comparable to those of the wealthy provinces.
Premiers and territorial leaders normally issue a joint communique at the end of their meetings. But McGuinty departed from precedent Tuesday, isssuing his own blunt statement objecting to any further increases in equalization.
He noted that equalization has grown by 30 per cent over the past four years and that the program is already designed to grow by a further 3.5 per cent each year.
"Enhancing equalization again - beyond the growth currently anticipated - is something Ontario taxpayers just can't afford," McGuinty said.
Ontario, Alberta and Saskatchewan are the only three provinces that do not receive equalization. McGuinty contends that any additional cash from Ottawa must benefit all provinces equally. He would prefer enriched transfer payments that are distributed strictly on a per-capita basis.
"We won't support a solution that helps half the population at the expense of the other half," he said.
However, Quebec Premier Jean Charest disputed the notion that Ontarians are being asked to pay more for equalization. The increases can be funded from surpluses already being amassed by Ottawa without any hike in taxes, he argued.
At a closing news conference Wednesday, Charest produced a chart showing that equalization payments, as a percentage of the size of the national economy, have shrunk over the past few years to an historic low of less than 0.7 per cent from an average of 1.1 per cent.
Binns acknowledged that Ontario taxpayers contribute most to the federal treasury. But he argued that's because the province is wealthy, due in part to federal policy that has ensured Ontario is the country's manufacturing centre.
"If we're going to have a Canada long term, we need (equalization). We can't have the big brother of Confederation sort of taking the car and the credit card and leaving those with less resources in the family behind if the country is going to work."
Some premiers didn't disguise their annoyance over McGuinty's decision to issue his own statement.
"We just haven't seen this before," Binns said. "It's disappointing."
Manitoba's Gary Doer echoed that sentiment.
"I'd prefer one communique," Doer said.
Doer said McGuinty should live with the conclusions of the report crafted by an blue-ribbon panel, noting that "Ontario agreed to the expert panel and they chose the co-chair."
"One of the reasons we established the panel is 13 of us couldn't agree to begin with," Doer added. "So we established an expert panel and I believe we should accept the recommendations and not cherry-pick the parts we like and the parts we don't like."
In objecting to any further increase in equalization, Ontario appears to be isolated.
On Tuesday, British Columbia's Gordon Campbell made a point of declaring that McGuinty was not alone in his criticism of the report.
But on Wednesday, Campbell hedged when asked specifically if he agreed that no more money should be pumped into equalization.
"I think too often this discussion is about who is taking what from whom," he said.
Campbell said any resolution to the imbalance must address both the fiscal disparity among provinces and the disparity between the federal and provincial levels of government.
However, Charest insisted Ontario is not isolated, stressing that discussions on the imbalance have only just begun.
"The issues are complex and our interests are not identical," he acknowledged.
But Charest insisted "an honourable compromise" will eventually be reached.
http://start.shaw.ca/start/enCA/News/NationalNewsArticle.htm?src=n041293A.xml