Canada's Equalization Program is Unfair and Ineffective: Maxime Bernier

Published on February 02, 2017

OTTAWA – Today, Maxime Bernier announced that he will bring fairness to Canada's system of equalization payments to provinces.

Rather than continuing the welfare trap that our system of equalization has become, Bernier proposes to create an environment that encourages provinces to succeed and thrive, rather than relying on aid from other parts of the country.

Bernier’s plan has two key components:

Immediately freeze the envelope of taxpayer dollars dedicated to equalization to stop the ever-increasing spending.

Form a Parliamentary Committee dedicated to reviewing the equalization formula, proposing common sense solutions that will give provinces the right incentives to grow their economies.

These changes will help promote pro-growth changes in provinces, without imposing the will of Ottawa in areas of provincial jurisdiction.

KEY MAXIME BERNIER QUOTES:

“Equalization money encourages recipient provinces to keep taxes high and to intervene more in their economies. They don’t have as much incentive to make their economies more competitive because more private sector growth will lead to less equalization money.”

“The system is similar to badly designed welfare programs that used to discourage recipients from working, because they would then lose all their benefits and would be worse off than if they stayed on welfare. That’s what we call a poverty trap”

“My approach will respect the provinces and our Constitution. My approach will respect taxpayers from across the country who fund this program and demand results”