New Brunswick has officially assumed the title of Canada’s poorest province and will begin receiving the most funding per capita from the federal government’s equalization support program, starting in April.
The bottom ranking and the poor economic numbers that caused it are unlocking significant new federal financial support for New Brunswick, but that is cold comfort for ending the longtime reign of Prince Edward Island as Canada’s neediest province, according to New Brunswick Finance Minister Ernie Steeves.
“Wow. That’s tough to take,” said Steeves in an interview Tuesday.
“When your transfer payments go up, it’s a sign your economy is weak. I’m not crazy about that. We want New Brunswick to be a have province, not a have-not province.”
The federal Finance Department released figures late Monday of what equalization-receiving provinces will qualify for in funding next year.
New Brunswick’s share is jumping 9.2 per cent to $2.21 billion, the largest increase among receiving provinces.
A sign of the times
The new amount is calculated by Ottawa to be worth $2,826 per person in New Brunswick, the most ever paid to a province, and a razor-thin $1 per person more than P.E.I. will receive.
It’s a remarkable turnaround for both provinces.
Last year, P.E.I. received $65 per person more in equalization than New Brunswick and, as recently as three years ago, was receiving $301 per person more — a sign of how quickly P.E.I.’s economy has closed in and, for its size, surpassed New Brunswick’s.
Equalization is a $20.6-billion federal program designed to help poorer provinces provide comparable levels of service to citizens at similar levels of taxation to richer provinces.
Payments are determined by a complex mathematical formula that measures the revenue-generating ability of each province against a national standard. Those with a below average ability to raise money for themselves qualify for funding.
Quebec receives the most money from the program — $13.25 billion next year — but at $1,547 per person in Quebec, it’s 45 per cent less than what New Brunswick will get.
Equalization amounts per person:
- New Brunswick: $2,826
- Prince Edward Island: $2,825
- Nova Scotia. $2,184
- Manitoba: $1,815
- Quebec: $1,547
The three territories do not receive equalization, but have a separate financing formula with the federal government.
New Brunswick hike ‘stood out,’ says prof
Trevor Tombe, an economics professor at the University of Calgary and one of Canada’s leading experts on equalization, said the $187-million jump in New Brunswick’s equalization allotment next year is remarkable, but the causes will take some time to analyze.
“The increase in New Brunswick is actually something that stood out,” said Tombe. “lt’ll be interesting to dig deeper to see what’s driving that specific change.”
The equalization formula uses three years of data and, according to Tombe, next year’s payments are based on provincial economic performance recorded between April 2016 and March 2019.
New Brunswick’s GDP growth over those three years was an estimated 3.7 per cent. That’s the weakest among equalization-receiving provinces, less than the national average and well below the 10 per cent growth recorded in P.E.I..
New Brunswick has long vowed to get itself off equalization. In 2006, former premier Shawn Graham set a “self-sufficiency” goal to be free of equalization payments by 2026. Instead amounts owing to New Brunswick have grown by $900 million, including by $550 million in just the last three years.
Steeves said being a “have” province is still New Brunswick’s goal even though, as Canada’s poorest provincial jurisdiction now, the need for equalization is undeniable.
“We want to be the ones that help everybody else, but right now we do need the help,” said Steeves.
“We’re trying to get our debt back in place where it should be and get it lowered so that we won’t need as much help. But right now we are reliant on Canada and Canadians.”
Canada will not approve new thermal coal mining projects
Canada will not approve new thermal coal mining projects or plans to expand existing mines because of the potential for environmental damage, Environment Minister Jonathan Wilkinson said on Friday.
“The government considers that these projects are likely to cause unacceptable environmental effects within federal jurisdiction and are not aligned with Canada‘s domestic and international climate change commitments,” he said.
In a statement, Wilkinson said thermal coal – primarily used for generating electricity – was the single largest contributor to climate change.
Canada produced 57 million tonnes of coal in 2019, just 1% of the overall global total. Canadian output in 2019 comprised 47% thermal coal and 53% metallurgical coal, which is used for steel manufacturing, according to official data.
“The continued mining and use of thermal coal for energy production in the world runs counter to what is needed to effectively combat climate change,” Wilkinson said. In 2018, Ottawa introduced regulations to phase-out conventional coal-fired electricity across Canada by 2030.
The new policy would apply to privately-held firm Coalspur’s plans to expand an existing thermal coal mine in the western province of Alberta, he said.
(Reporting by David Ljunggren; Editing by Kirsten Donovan)
Victoria cancels Canada Day celebration after mass grave discovery
Victoria British Columbia has decided to cancel a virtual celebration of the national Canada Day holiday on July 1 after discovery of unmarked graves of children at a now-defunct indigenous boarding school.
The city council of Victoria voted on Thursday instead to air programming led by the local indigenous nation at a later date. Local indigenous leaders who usually participate in Canada Day ceremonies declined after remains of 215 children were found at the former school in Kamlooops, northern British Columbia.
“They’re grief-struck and reeling, as are many indigenous people across the country,” Lisa Helps, mayor of Victoria, told the Canadian Broadcasting Corporation on Thursday.
Victoria will “produce a broadcast to air later this summer guided by the Lekwungen people and featuring local artists, that explores what it means to be Canadian, in light of recent events,” she said.
The Songhees Nation, of which the Lekwungen people are members, did not immediately respond to a request for comment.
(Reporting by Moira Warburton in Vancouver; Editing by Cynthia Osterman)
NATO summit seeks return to gravitas with Biden
NATO leaders will seek reassurance on Monday from that after four years of denigration by his predecessor Donald Trump, the alliance can count on the support of the United States, its most powerful member.
In a more pared-back gathering than past NATO summits in part due to COVID-19 restrictions, without fighter jet fly-pasts, the 30 allies will gather in their glass and steel headquarters to agree reforms for a multipolar, post-Cold War world where China’s military rise presents a new challenge.
The summit is a “unique opportunity” to renew transatlantic ties, according to NATO Secretary-General Jens Stoltenberg.
Brussels’ town hall in the historic Grand Place will be illuminated in NATO’s signature blue on Sunday night while the Belgian capital’s famed bronze fountain of a boy urinating will also don a NATO-branded outfit on Monday.
“The first thing is for Biden to recommit to NATO’s collective defence,” Jamie Shea, a former senior NATO official who was at a 2018 summit at which Trump considered quitting the alliance.
Trump brought a television reality-show quality to the NATO summits he attended from 2017 to 2019, diplomats said, attracting international attention but also wearing down allies whom he called “delinquent” for not spending enough on defence.
Biden has already annulled a Trump decision to pull U.S. troops out of Germany, although there is still American pressure for European allies to pay more towards their own security. Stoltenberg said on Friday that European allies, Turkey and Canada will have collectively increased their defence budgets by $260 billion by the end of 2021, compared to 2014.
“This summit with Biden should be a signal to the world that NATO is back,” said a senior European NATO diplomat who was also at the alliance during the Trump years.
“There was so much noise and it was a difficult time. But now we can actually talk about the things that matter, the defining security challenges of our time,” the envoy said.
Founded in 1949 to contain a military threat from the Soviet Union, NATO celebrated its 70th anniversary at a summit in London in December 2019.
Russia, climate change, Afghanistan and new technologies are on the menu of the day-long summit, which will culminate in a special leaders’ session in the amphitheatre-like North Atlantic Council chamber.
“I expect Allies will agree a new cyber defence policy for NATO,” Stoltenberg said. “It will recognise that cyberspace is contested at all times,” he told a news conference.
Having strengthened its capability to carry out its core mission of defending Europe following Russia’s 2014 annexation of Crimea, NATO now aims to be more ambitious.
In a twist of fate, the NATO summit will agree reforms to the alliance, known as NATO 2030, which were set in motion after Trump questioned its relevance.
Stoltenberg will set out nine areas where NATO could modernise over the medium term, including more joint allied funding of military operations. However, France has already expressed concern about the proposal, fearing it will take money away from national military priorities.
Leaders are likely to agree to draw up a new master strategy document, known as NATO’s Strategic Concept, to include China’s military rise as a challenge for the first time.
(Reporting by Robin Emmott; Editing by Giles Elgood and Angus MacSwan)