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How much are these payments Alberta is making?

The idea that Alberta is making “payments” into an equalization fund is a common misconception and probably generates a lot of the misplaced ire for the program. In fact, the equalization fund comes from general federal revenues and grows each year in line with the economy. This year, about $18 billion will be doled out to Prince Edward Island, Nova Scotia, New Brunswick, Quebec, Ontario and Manitoba, with $11 billion going to Quebec alone.

Payments from the federal government to have-not provinces are based on their fiscal capacity, but wealthier provinces receive nothing.

So is Alberta getting screwed?

To paraphrase a proverb, screwing is in the eye of the beholder. An Albertan looking at equalization with the glass half-full might say the province’s wealth, relative to the rest of Canada, means it’s too rich to need help and that’s a good thing.

Some Albertans look at per capita federal transfer payments — equalization is just one — and the massive amount of federal income tax flooding into Ottawa from Alberta, and believe they’re getting a raw deal. And it is undeniable that Alberta is ponying up more money than it receives from the feds and it certainly receives less than other provinces.

For example, Alberta pulls in about $1,388 per capita, while Nova Scotia gets $3,243 per capita in federal transfers. Equalization only accounts for about eight per cent of the discrepancy in money going to the federal government and money going back to Alberta, but it tends to draw most of the anger.