Constitution says Offshore resources belong to the Federal Government

[Canuck E Stan]

The Federal government owns the offshore resources as stated in the constitution. How is it that the maritime provinces has nulified this ownership and claimed it as theirs. Legally they should get nothing from oil revenues found offshore.Claiming broken promises and accords, in reality Williams and the rest have no right to make any kind of deal with any oil company over a juristiction that belongs to the Feds. are the Feds being too nice to the Maritimes and are the Maritimes just being too greedy?

Sweetheart Deal

The facts are these. Constitutionally, offshore resources are under federal, not provincial ownership. Twenty-odd years ago, however, the Mulroney government agreed to pretend they were provincial, giving the Atlantic provinces first crack at the royalties.

In 2005, the Martin government took this a step further, agreeing not only that the provinces of Nova Scotia and Newfoundland were entitled to collect royalties on resources they don’t own, but that they should continue to collect equalization payments as if they did not also collect royalties.

[Shakeyhands]

same thing should go for natural resources in other provinces then?

[Michael Bluth]

same thing should go for natural resources in other provinces then?

The Constitution treats offshore resources differently then the resources actually found within a province.

Why should the same thing go?

[Shakeyhands]

was more of a question really. If the resource falls within Provincial boundries, it either belongs to the Province or the Fed's, shouldn't depend on the province. Seems to me it should be all or none for all provinces regardless of the resource or where its physically located. Just a thought

[Fortunata]

Don't maritime provinces have jurisdiction to a certain amount of miles off their coasts? Like countries do?

[Michael Bluth]

Don't maritime provinces have jurisdiction to a certain amount of miles off their coasts? Like countries do?

Maritime law is an interesting one.

The international standard is 12 miles.

Canada has negotiated to extend fishing rights to a total of 200 miles.

IIRC Hibernia and White Rose are outside the 12 mile limit...

[gc1765]

The Constitution treats offshore resources differently then the resources actually found within a province.

Why should the same thing go?

Why does it matter if the resources are on land or offshore?

[Canuck E Stan]

Why does it matter if the resources are on land or offshore?

Then maybe Ontario or Manitoba should also make claim to the resources offshore if the Feds are giving up Federal ownership to Newfoundland and Nova Scotia?

Everybody makes a big deal about the constitution and rights held within, and how it's a big deal to "open" the consitution to make changes, what happened here?

I don't remember a declaration to the right to"give" away ownership to whoever the Feds wish.

[Remiel]

I think the Maritimes should be allowed their ocean resources. The ocean is the only equalizer to the amount of resources other provinces have based on their sheer size. They have always been tied to the sea, and thus the sea should be tied to them.

[NovaScotian]

I think the Maritimes should be allowed their ocean resources. The ocean is the only equalizer to the amount of resources other provinces have based on their sheer size. They have always been tied to the sea, and thus the sea should be tied to them.

That is a good point. All other provinces were granted huge land tracts with plenty of natural resources(oil, gas, hydro, mineral wealth, etc) while the Maritime provinces remained small and since offshore resources were under federal jurisdiction it hindered the ability of the provinces to generate funds.

[Canuck E Stan]

I think the Maritimes should be allowed their ocean resources. The ocean is the only equalizer to the amount of resources other provinces have based on their sheer size. They have always been tied to the sea, and thus the sea should be tied to them.

Sounds like their logic for equalization payments......they've always been tied to the payments, and thus the payments should always be tied to them.

[Remiel]

Sounds like their logic for equalization payments......they've always been tied to the payments, and thus the payments should always be tied to them.

Should they be allowed free reign to develop those resources, there is probably an increased likelihood that someday they will no longer be eligible for equalization payments under any formula.

[gc1765]

Then maybe Ontario or Manitoba should also make claim to the resources offshore if the Feds are giving up Federal ownership to Newfoundland and Nova Scotia?

Sure, and while they are at it, Ontario can make a claim to the resources of Alberta?

[g_bambino]

I think the Maritimes should be allowed their ocean resources. The ocean is the only equalizer to the amount of resources other provinces have based on their sheer size. They have always been tied to the sea, and thus the sea should be tied to them.

What about BC, then, which has both land size and extensive ocean shoreline?

[Canuck E Stan]

Then maybe Ontario or Manitoba should also make claim to the resources offshore if the Feds are giving up Federal ownership to Newfoundland and Nova Scotia?

Sure, and while they are at it, Ontario can make a claim to the resources of Alberta?

Nice try,but sorry,that's provincial juristiction.Oceans are Federal juristiction.

[Canuck E Stan]

Should they be allowed free reign to develop those resources, there is probably an increased likelihood that someday they will no longer be eligible for equalization payments under any formula.

Sounds like a nice idea but that's not the way they want it.

Sweetheart Deal

Too sweet: they should never have been signed. Under the accords, the two provinces will still be entitled to equalization even after their governments, aready awash in oil revenues, have grown wealthier than Ontario’s.

The most that can be said for the premiers’ position is that the Accords say payments should be based on “the Equalization formula as it applies at the time.” On the premiers’ reading, this means they should be entitled both to the protections of the Accord and the new formula’s enriched payments. But the new formula isn’t just about higher payouts. It also includes the cap.

What the premiers are demanding is some mythical third option, one with higher payments, no clawback, and no cap. They want the best of three worlds: to have their cake, eat it, and spin it above their heads.

[gc1765]

Nice try,but sorry,that's provincial juristiction.Oceans are Federal juristiction.

Constitution aside, what's the difference?

[Michael Bluth]

Constitution aside, what's the difference?

You can't leave the Constitution aside.

It's the supreme law of the land.

Nothing democratic should supercede it.

[gc1765]

You can't leave the Constitution aside.

It's the supreme law of the land.

Nothing democratic should supercede it.

I'm not saying it should. I'm asking why there should be a difference?

[geoffrey]

I'm not saying it should. I'm asking why there should be a difference?

There shouldn't.

There also shouldn't be a difference between Alberta's equalisation and Newfoundlands. If they get the deal, we should too. Are you okay with Alberta no longer paying into the pot because it's all resource revenues? I hope you realise that means that the rest of Canada would have to seriously scale back their social programs and increase taxes.

I want the Atlantic accord here, a neat little guarntee that we'll never have to pay anything ever.

Like Coyne says, it is possible to have Newfoundland richer in revenues than Ontario and still have money flowing from Ontario to Newfoundland.

More importantly and on a much larger per capita basis, from Alberta to Newfoundland.

Why should they get what we don't? I have little sympathy for them. Danny Williams has chosen not to allow industry to flourish in his province, that's his choice, I shouldn't pay for it or have to give him a special deal.

Coyne hits the nail on the head. These Premiers are brats. Harper shouldn't give them an inch.

They want the extra money, AND the Atlantic accord AND additional provisions.

Ridiculous. Enough is enough. Pay their own way.

[gc1765]

There shouldn't.

There also shouldn't be a difference between Alberta's equalisation and Newfoundlands. If they get the deal, we should too. Are you okay with Alberta no longer paying into the pot because it's all resource revenues?

I thought resource revenues were already not included in equalization. At least, that is what Harper promised. If that's not the case, wouldn't Albertans be pretty outraged right now?

[geoffrey]

I thought resource revenues were already not included in equalization. At least, that is what Harper promised. If that's not the case, wouldn't Albertans be pretty outraged right now?

Not really, not right now anyways. The more that resource revenues are calcuated the less we pay out.

The equalisation system is far more complex than this, but I'll give a brief run down. All individuals in provinces pay in a certain amount (through Federal taxation mostly of incomes and the like)... then money is given back on the basis of creating equality in government revenues so that all governments can deliver similar programs.

Currently this is based on a 5 province standard, using 'normal' provinces of British Columbia, Saskatchewan, Manitoba, Ontario and Quebec. The Maritimes aren't included because they are outliers on the low end and take away Quebec's benefits and Alberta would distort the system in the other direction. That's why they aren't included.

Including resource royalties makes the other provinces incomes higher (notably Saskatchewans and BC's) and forces them to take less... the difference being distributed over all the provinces (equalisation is a zero sum game).

Increasing Alberta's recognized income doesn't do anything. Well, so long as they aren't included in the calcuation.

Ontario wants to move to a 10 province standard that includes Alberta's oil wealth in the calcuation. Obviously, that's unreasonable as Alberta would be pulling the weight for much of the country. Various other provinces want different deals, generally to benefit themselves.

But on a provincial level, no one pays equalisation, they only receive it, that's how you've got to look at it if you want to understand all the negoiations around it. The only way a province pays less is if the Federal government cuts general tax rates and their citizens pay less.

[gc1765]

Including resource royalties makes the other provinces incomes higher (notably Saskatchewans and BC's) and forces them to take less... the difference being distributed over all the provinces (equalisation is a zero sum game).

But that's not what's happening right now? Maybe I'm not understanding this correctly. I always thought that resources were not included when calculating equalization, and that Harper promised to keep it that way, because there was debate about whether they should be included or not. If you included Saskatchewan's resource revenue, they would not be receiving money, but since they aren't included, they receive money. If that oil happened to be found offshore, in the maritimes, it wouldn't be included either. Seems to me that people here are trying to argue that offshore oil should be included, but not "on shore" oil.

[geoffrey]

But that's not what's happening right now? Maybe I'm not understanding this correctly. I always thought that resources were not included when calculating equalization, and that Harper promised to keep it that way, because there was debate about whether they should be included or not. If you included Saskatchewan's resource revenue, they would not be receiving money, but since they aren't included, they receive money. If that oil happened to be found offshore, in the maritimes, it wouldn't be included either. Seems to me that people here are trying to argue that offshore oil should be included, but not "on shore" oil.

Constitutionally, that's the way it should be, but I think it should be fair either way we actually chose to do it. If Calvert gives up 50%, then so does the Maritimes. If Williams gets a break and doesn't have to pay on oil, then Calvert (and Stelmach) should get the same break.

[gc1765]

If Calvert gives up 50%, then so does the Maritimes. If Williams gets a break and doesn't have to pay on oil, then Calvert (and Stelmach) should get the same break.

Agreed. I just figured Albertans would side with the maritimes on this one...that is to say, that resources should be excluded. I know it doesn't matter now because you are not receiving equalization, but in principle, how do you feel about resources being included?

edit: I'm still confused on whether they are included or not

"Under the new Equalization program, provinces will get the greater of the amount they would receive by fully excluding natural resource revenues, or by excluding 50% of natural resource revenues."