Holding a referendum on equalization this fall in Alberta is a strategy to get Ottawa to the table to negotiate “fairness” for the province, Premier Jason Kenney says.
Kenney introduced a motion calling for a referendum into the legislature late on Monday.
If passed, Albertans would be asked as part of the October municipal election whether they think the section dealing with equalization payments should be removed from the Canadian Constitution — something Alberta doesn’t actually have the power to do on its own.
The UCP government has insisted since the last provincial election that the current equalization payments are one of the ways Alberta is not getting a “fair deal” from Ottawa.
Equalization payments come from Ottawa, using money collected through federal taxes. Transfers are sent out to provinces with lower incomes. Provinces with higher incomes — like Alberta — do not receive transfers.
“For millions of Albertans equalization has become the most powerful symbol of the unfairness of Alberta’s deal and Confederation and for good reason,” Kenney said at a press conference.
The referendum was an election promise by the UCP as well as one of the recommendations to come out of the Fair Deal Panel report aimed at improving the province’s economic position within Confederation.
Alberta doesn’t actually have the power to change the federal payments on its own. The referendum would be completely non-binding on Ottawa and, if Albertans vote yes, simply require the Alberta government to “take steps” towards making a change.
Kenney said he didn’t expect a yes vote from Alberta to be enough to automatically lead to change federally but that the provincial government would ask Ottawa for “at least negotiations over the question of equalization in the Constitution.”
Making changes to the Constitution would require approval from the House of Commons, the Senate, and at least two-thirds of the provincial legislative assemblies and come with legal and political consequences, according to the Fair Deal Panel’s report.
The premier called that yes vote a “strategy to elevate Alberta’s fight for fairness in the federation to the top of the national agenda.”
“This is a legal tool to make a very strong political point in the strongest way possible to assert our fight for fairness in the Federation,” he said.
NDP Opposition Leader Rachel Notley acknowledged that Albertans have “significant” frustrations with the current equalization formula. She said components like how natural resources are calculated need to be fixed but said that Alberta does not have the ability to change the Constitution
“What we know is that Albertans are frustrated with the fiscal relationship we have with Ottawa … but I don’t believe that the referendum as it’s currently worded is actually designed to fix that. Because we absolutely know there is no solution at the end of that vote,” she said Monday.
“What they should be doing is focusing on changing the formula. The formula, which the last time it was significantly amended, was actually amended by Stephen Harper and his cabinet colleagues including Jason Kenney.”
