Thursday, May 04, 2006
Equalization budget 2006
Certainty for Equalization and Territorial Formula Financing
Equalization and Territorial Formula Financing (TFF) are extremely important programs to the Canadian federation. The Government is committed to putting in place renewed, transparent, principle-based Equalization and TFF programs providing predictable ongoing support to provinces and territories as a key element in restoring fiscal balance in Canada.
The report of the Expert Panel on Equalization and Territorial Formula Financing will be made public in spring 2006. This report and other contributions to the debate, such as the report of the Council of the Federation's Advisory Panel on Fiscal Imbalance, along with subsequent consultations with provinces and territories, will be critical elements in arriving at renewed, transparent and principle-based Equalization and TFF programs.
Equalization and TFF allocations for 2006–07 were announced by the previous government in November 2005 but were not passed by Parliament. Since then, more recent economic and fiscal data have become available.
Budget 2006 proposes a new approach that gives certainty to provinces and territories and ensures that they all benefit. The most current data will be used to determine the allocations for 2006–07 since it best reflects the fiscal and economic situations of provinces and territories. As a result, six Equalization-receiving provinces and one territory—Prince Edward Island, Nova Scotia, New Brunswick, Quebec, Manitoba, Saskatchewan and the Northwest Territories—will receive higher payments than they were advised they would receive in November 2005.
For the other two provinces and two territories, Newfoundland and Labrador, British Columbia, Yukon and Nunavut, using the most recent data would result in lower payments. For those provinces and territories where there is a decline from the amount they had been advised of in November 2005, one-time adjustments to offset the decline will be provided. Budget 2006 provides an extra $255.4 million for provinces and territories for these one-time adjustments.
Table 3.14
2006–07 Equalization and Territorial Formula Financing
Entitlements and One-Time Adjustments
Province/territory November
2005 announcement Budget 2006 Increase over November 2005 One-time adjustments
(millions of dollars)
Newfoundland and Labrador 687 632 – 54.4
Prince Edward Island 280 291 11.7 –
Nova Scotia 1,379 1,386 6.2 –
New Brunswick 1,432 1,451 18.7 –
Quebec 5,354 5,539 185.1 –
Manitoba 1,690 1,709 19.2 –
Saskatchewan 0 13 12.7 –
British Columbia 459 260 – 199.2
Total Equalization 11,282 11,282 – 253.6
Yukon 506 506 – 0.3
Northwest Territories 738 739 1.9 –
Nunavut 827 825 – 1.6
Total TFF 2,070 2,070 – 1.9
Total Equalization
and TFF 13,352 13,352 – 255.4
Note: Totals may not add due to rounding.
NL -54 Million Outmigration. Wait until this years census is completed we will be that much smaller lets say 350,000 population.
Equalization and Territorial Formula Financing (TFF) are extremely important programs to the Canadian federation. The Government is committed to putting in place renewed, transparent, principle-based Equalization and TFF programs providing predictable ongoing support to provinces and territories as a key element in restoring fiscal balance in Canada.
The report of the Expert Panel on Equalization and Territorial Formula Financing will be made public in spring 2006. This report and other contributions to the debate, such as the report of the Council of the Federation's Advisory Panel on Fiscal Imbalance, along with subsequent consultations with provinces and territories, will be critical elements in arriving at renewed, transparent and principle-based Equalization and TFF programs.
Equalization and TFF allocations for 2006–07 were announced by the previous government in November 2005 but were not passed by Parliament. Since then, more recent economic and fiscal data have become available.
Budget 2006 proposes a new approach that gives certainty to provinces and territories and ensures that they all benefit. The most current data will be used to determine the allocations for 2006–07 since it best reflects the fiscal and economic situations of provinces and territories. As a result, six Equalization-receiving provinces and one territory—Prince Edward Island, Nova Scotia, New Brunswick, Quebec, Manitoba, Saskatchewan and the Northwest Territories—will receive higher payments than they were advised they would receive in November 2005.
For the other two provinces and two territories, Newfoundland and Labrador, British Columbia, Yukon and Nunavut, using the most recent data would result in lower payments. For those provinces and territories where there is a decline from the amount they had been advised of in November 2005, one-time adjustments to offset the decline will be provided. Budget 2006 provides an extra $255.4 million for provinces and territories for these one-time adjustments.
Table 3.14
2006–07 Equalization and Territorial Formula Financing
Entitlements and One-Time Adjustments
Province/territory November
2005 announcement Budget 2006 Increase over November 2005 One-time adjustments
(millions of dollars)
Newfoundland and Labrador 687 632 – 54.4
Prince Edward Island 280 291 11.7 –
Nova Scotia 1,379 1,386 6.2 –
New Brunswick 1,432 1,451 18.7 –
Quebec 5,354 5,539 185.1 –
Manitoba 1,690 1,709 19.2 –
Saskatchewan 0 13 12.7 –
British Columbia 459 260 – 199.2
Total Equalization 11,282 11,282 – 253.6
Yukon 506 506 – 0.3
Northwest Territories 738 739 1.9 –
Nunavut 827 825 – 1.6
Total TFF 2,070 2,070 – 1.9
Total Equalization
and TFF 13,352 13,352 – 255.4
Note: Totals may not add due to rounding.
NL -54 Million Outmigration. Wait until this years census is completed we will be that much smaller lets say 350,000 population.
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