Like many Canadians, Tony Gull has a misunderstanding of Canada’s equalization program (St. Albert Gazette, Your Views, Oct. 31).
It is one of many federal transfers to the provinces. Federal revenues in the form of taxes (personal, corporate, GST, etc.) are collected from all Canadians and redistributed through equalization to qualifying provinces.
Federal tax rates are the same across Canada. Albertans pay federal taxes at the same rate as all Canadians. If equalization ended tomorrow, there would be no change in the total dollars sent to Ottawa by Albertans. Alberta does not send payments to Ontario, Quebec, Manitoba or any other province.
Ontario, the most populous province, is by far the largest contributor to federal revenues even though it qualifies for some equalization payments. Ontario’s contribution to Ottawa far exceeds equalization funds received.
Alberta is a major contributor to federal coffers and has not received equalization payments for several years thanks to the energy sector. However Alberta’s resource-based economy is at a clear disadvantage compared to Ontario, with its diversified economy into which the feds pour billions of dollars for goods and services. Federal expenditures in Ontario far exceed Alberta.
The need, as expressed by former premier Peter Lougheed decades ago, is for Alberta to diversify its economy to offset any disadvantage. Past governments have had very limited success, as we are still vulnerable to fluctuating oil prices.
Hopefully, current and future governments will have more success.
Roger Lecuyer, St. Albert
