Ontario to Recieve Equalization

[Smallc]

Ontario will qualify for the federal government's equalization program and receive $347 million in transfer payments next year, federal Finance Minister Jim Flaherty said Monday after a meeting with his provincial and territorial counterparts.

Although Ontario has qualified under the nearly $12-billion federal wealth-sharing plan five times in the past, the payment will be the first time has received money under the program, which has richer provinces provide funds to poorer provinces to ensure they can provide basic government services.

CBC

[White Doors]

Kengs? you must feel utterly humiliated?

[Argus]

CBC

Where does this equalization come from anyway? And since Ontario has always been the biggest source of transfers to the other provinces, most of whom remain "have not' provinces, uhm, where is that money coming from? I'd love to see the accounting on this, because I suspect it's more a matter of the feds refunding a few hundred millions of the billions it will take from Ontario to transfer to the other provinces, and NOT a case of Ontario actually getting more than it pays out.

[White Doors]

Where does this equalization come from anyway? And since Ontario has always been the biggest source of transfers to the other provinces, most of whom remain "have not' provinces, uhm, where is that money coming from? I'd love to see the accounting on this, because I suspect it's more a matter of the feds refunding a few hundred millions of the billions it will take from Ontario to transfer to the other provinces, and NOT a case of Ontario actually getting more than it pays out.

Alberta, Saskatchewan and BC last I heard

[Argus]

Alberta, Saskatchewan and BC last I heard

As far as I knew, most of it still came from Ontario, and with the hit to commodity prices I don't see how AB and Sask are going to be pumping out as many profits as they did last year.

[Smallc]

It comes from Federal Revenues, just like it always did.

[blueblood]

Alberta, Saskatchewan and BC last I heard

revenge is a dish best served cold!!!

[Smallc]

revenge is a dish best served cold!!!

Ontario is still a net contributor to the tune of over $11.5B per year when it comes to provincial transfers. That was said today on Politics, with Don Newman.

Edited November 3, 2008 by Smallc

[kengs333]

Kengs? you must feel utterly humiliated?

Why? It's a laughably small amount, but still long overdue considering the fact that Ontario has been carrying the rest of the country for almost 150 years.

Also, I wish they would do something about the HST--why I in Ontario have to pay a tax levied in the Martimes everytime I ship to one of those provinces is beyond me.

[kengs333]

Ontario is still a net contributor to the tune of over 11.5B per year when it comes to provincial transfers. That was said today on Politics, with Don Newman.

And aren't we short about $18b? So really we're not getting all that much.

[Keepitsimple]

It was comical to see Dwight Duncan, Ontario's Finance Minister, tripping over himself trying NOT to say anything nice about Ottawa.

Edited November 4, 2008 by Keepitsimple

[Smallc]

It was comical to see Dwight Duncan, Ontario's Finance Minister, tripping over himself trying NOT to say anything nice about Ottawa.

Why should he say anything nice about Ottawa. They certainly don't have anything nice to say about Ontario. Flaherty dumps on them every chance he gets. If Flaherty can't accept the democratically elected Ontario Government, that's too bad for him.

Edited November 4, 2008 by Smallc

[blueblood]

Why should he say anything nice about Ottawa. They certainly don't have anything nice to say about Ontario. Flaherty dumps on them every chance he gets. If Flaherty can't accept the democratically elected Ontario Government, that's too bad for him.

Truth hurts, if the Ontario liberals want to run things half assed, they can pay the price. Why should Flaherty pander to a hostile provincial gov't.

[Smallc]

Truth hurts, if the Ontario liberals want to run things half assed, they can pay the price. Why should Flaherty pander to a hostile provincial gov't.

What is happening in Ontario has absolutely nothing to do with the Ontario Government. The people of Ontario elected them and they are doing the best they can given the situations.

[August1991]

Where does this equalization come from anyway? And since Ontario has always been the biggest source of transfers to the other provinces, most of whom remain "have not' provinces, uhm, where is that money coming from? I'd love to see the accounting on this, because I suspect it's more a matter of the feds refunding a few hundred millions of the billions it will take from Ontario to transfer to the other provinces, and NOT a case of Ontario actually getting more than it pays out.

It's net, Argus.

Ontario is still a net contributor to the tune of over $11.5B per year when it comes to provincial transfers. That was said today on Politics, with Don Newman.

Newman is wrong. This payment is net.

---

In fact, equalization is a small part of the equation. How much does Ontario benefit from a federal Canada? Well, Ottawa is in Ontario so it is probably accurate to say that if you are from the Ontario valley, you can work for Canada.

I have always felt that without Canada, people in Ontario fear that they would be another Michigan. If Canada dissolved, the rest of Canada would do well but Ontario would become just another rust-belt state. IOW, Ontario (and specifically Toronto) requires Canada to establish its status.

Edited November 4, 2008 by August1991

[Smallc]

It's net, Argus.

Newman is wrong. This payment is net.

No, its not net. I don't think you understand how Equalization works. Provinces don't pay each other, but rather, the money comes from Federal revenues and is funneled to the provinces that need it in order to meet an average fiscal capacity. For this year, 2008, the province that was the determining one of fiscal capacity was British Columbia. Any province with less internal fiscal capacity would receive equalization and any province with the same or more would not. That will not be the case going forward. It will be based on the current level adjusted for increases in Nominal GDP.

In the case of Ontario, it still pays into the system in that the people of Ontario pay Federal Taxes. This upcoming year, $347M worth of those Federal Taxes will be returned to the Ontario Government in the form of Equalization payments. Up until this point, Ontario has never ever received $1 in equalization payments, net or otherwise.

The $11.5B figure I quoted takes into account the Canada Health Transfer and the Canada Social Transfer as well as Equalization. Ontario is still very much a net contributor to the transfer programs and is really still a net contributor to even Equalization on its own.

Quebec, on the other hand, receives over $8B a year from Equalization alone. It is most liekely not a net contributor to the system. The same goes for Manitoba.

Edited November 4, 2008 by Smallc

[August1991]

No, its not net. I don't think you understand how Equalization works. Provinces don't pay each other, but rather, the money comes from Federal revenues and is funneled to the provinces that need it in order to meet an average fiscal capacity. For this year, 2008, the province that was the determining one of fiscal capacity was British Columbia. Any province with less internal fiscal capacity would receive equalization and any province with the same or more would not. That will not be the case going forward. It will be based on the current level adjusted for increases in Nominal GDP.

In the case of Ontario, it still pays into the system in that the people of Ontario pay Federal Taxes. This upcoming year, $347M worth of those Federal Taxes will be returned to the Ontario Government in the form of Equalization payments. Up until this point, Ontario has never ever received $1 in equalization payments, net or otherwise.

Describe it as you wish, but it's still a net payment.

I give you $5 and you give me $7 - I got $2.

Anyway, McGuinty wanted fairness. He got it.

And as I note above, without Canada, Ontario is just another Michigan.

[Smallc]

Describe it as you wish, but it's still a net payment.

I give you $5 and you give me $7 - I got $2.

No, I'm sorry, but your wrong. This is more like, me giving you $10 and you giving me $.50 back. Its still a net contribution. Its just that, Ontario is now drawing back some of the contribution.

And as I note above, without Canada, Ontario is just another Michigan.

So says you.

Edited November 4, 2008 by Smallc

[Jerry J. Fortin]

Look at it from an Alberta viewpoint.

[White Doors]

Why? It's a laughably small amount, but still long overdue considering the fact that Ontario has been carrying the rest of the country for almost 150 years.

Also, I wish they would do something about the HST--why I in Ontario have to pay a tax levied in the Martimes everytime I ship to one of those provinces is beyond me.

Of course it's beyond you. Don't worry, Danny Williams was interviewed yesterday and said that Newfoundland would be there in Ontario's time of need.

[Wild Bill]

What is happening in Ontario has absolutely nothing to do with the Ontario Government. The people of Ontario elected them and they are doing the best they can given the situations.

Well, that's your opinion! I didn't vote vote them and I don't respect much of what they've done!

I could use "progressive" logic to make the claim that since Dalton did not receive a clear majority of the popular vote then the majority of my fellow Ontarioans must be Tory, or at least anti-Liberal. Why not, since the claim is constantly being made whenever a Conservative government, federal or provincial is elected.

Dalton won the last election for one reason only. John Tory and his team blew it big time over religious school funding! If not for that bonehead move Dalton would have had a real fight on his hands and may well have lost.

Whatever, one thing's for sure. Dalton will have a hard time pulling votes in Caledonia for years to come. After seeing how he valued the rights of those poor townsfolk I can clearly see how much my own rights would be protected in any conflict by a Ontario Liberal government.

[Smallc]

Well, that's your opinion! I didn't vote vote them and I don't respect much of what they've done!

And I wouldn't expect you too. What is happening in Ontario has very little to do with Ontario, never mind the Government of Ontario.

[madmax]

What is happening in Ontario has absolutely nothing to do with the Ontario Government. The people of Ontario elected them and they are doing the best they can given the situations.

The Ontario Liberals, much like the Federal Conservatives have had their heads in the sand for at least 2 years, completely ignoring and disregarding the trend in the economy. Even today, I don't believe these two governments get it. They still harp on Automanufacturing like it is the be all and end all, or that industry is old.

E.D. Smith is closing a 5 year old food processing plant and relocating to the US.

The Ontario Liberals have spent money like drunken sailors, and have little to show.

The Federal Cons and Provincial Libs engage in corporate welfare with no strings. Infact, the CPC have just made it easier for companies to pack up and leave.

To think that the Ontario Liberals have NOTHING to do with the fact that Ontarios Economic Engine is collapsing, while they fiddle is absurd. Never before has Ontario collected.

While this sum of 347 Million is not large in the grand scheme as it doesn't offset the small defecit that the Ontario Liberals are projecting. 500 Million, there is a huge problem with the amount of Government Spending and handouts the Ontario Liberals have engaged in. They have little to show for the 33% increase in spending.

Now the hard times, (that should fool nobody who pay attention to Ontarios Econony, especially the government,)

The Liberals have NO PLAN. They have no plan 1 year after being re elected. The Ontario Bubble was bursting when they took office. Both the PC and the NDP highlighted major economic troubles, and the Ontario Liberals disregarded all input. If it wasn't decided at Niagara on the Lake, it didn't exist.

The people of Ontario re-elected the OLPC because they hadn't screwed up to that point, and the OLPC made hay over John Tories poor decision on Religious Funding. But that doesn't change the economic reality on the ground that the liberals ignored the heart of their economy from South Western Ontario to Northern Ontario.

It is a disgrace that Ontario will accept these payments from the Feds for the first time.

Seeing Ontarios wages hover near $10 only reaffirms that Ontario will be receiving equalization payments for a long long long time.

So while smallc is correct in that the government of Ontario has no role in equalization payments, as is affirmed here....

Equalization payments do not, technically, involve wealthy provinces making payments to poor provinces, although in practice this is what happens, via the federal treasury. As an example, a wealthy citizen in New Brunswick, a so-called "have not" province, pays more into equalization than a poorer citizen in Ontario, a so-called "have" province. However, because of Ontario's greater population and wealth, the citizens of Ontario as a whole are net contributors to equalization, while the citizens of New Brunswick are net receivers of equalization payments.

It appears to me that Ontario receiving more of its own money back, while technically fair, is indicated of a greater storm on the horizon.

While the Federal Government policies have direct impact on Ontarios economy the fact that Ontario bleeds is also a direct result of..........

Ontario Liberals ignorance and arrogance.

[Argus]

Why should he say anything nice about Ottawa. They certainly don't have anything nice to say about Ontario. Flaherty dumps on them every chance he gets. If Flaherty can't accept the democratically elected Ontario Government, that's too bad for him.

The "democratically elected government of Ontario" is collecting something on the order of $25 billion more each year in taxes now than it was under Ernie Eves, and is still going to run up a huge deficit in the coming years because of it's out-of-control spending.

[Argus]

What is happening in Ontario has absolutely nothing to do with the Ontario Government. The people of Ontario elected them and they are doing the best they can given the situations.

Right, and them collecting an extra $25 billlion from Ontario's citizens every year has not had any affect whatsoever on the economy. Having the highest corporate taxes in Canada, among the highest on Earth, has not had the slightest affect on business here, and increasing program spending by 50% over the last four years has nothing at all to do with Ontario running a deficit. Nothing whatsoever!

Shouldn't your name be SmallL?