Ontario demands fair play on equalization

TheGlobeandMail.com – national – Ontario demands fair play on equalization
September 22, 2008. MURRAY CAMPBELL

TORONTO — Ontario Premier Dalton McGuinty has asked the federal party leaders to guarantee that the rules for the equalization program won’t be changed to prevent his province from receiving a payout.

The erosion of Ontario’s manufacturing base has some economists predicting the province will qualify for equalization payments by 2010.

But Mr. McGuinty said today that he is worried that the federal government would never allow this to happen.

The Premier noted that the rules were changed in the 1970s to prevent Ontario from making a first-ever claim on the scheme and he sees the same scenario unfolding.

“I’m concerned there is an institutionalized philosophy in Ottawa that says Ontario shall never benefit from equalization,” he told reporters.

He said in his letter to the party leaders, he said “if you want to play around with the rules, that’s one thing – just make sure that we don’t get anything less than under the existing rules.”

Mr. McGuinty said that he also asked the party leaders in the letter sent today for their positions on the so-called “fairness” issue in which Ontario taxpayers send $20-billion more to Ottawa than they receive in return in federal services.

“Ontarians need to know where the federal parties stand on this issue,” the Premier told a breakfast meeting of the Economic Club of Canada.

He said Ontario has been a willing contributor to equalization for the past 50 years because it believed that other provinces needed money to build stronger economies.

“But we also believe that fairness is a two-way street,” he said. “We have been fair with our fellow Canadians and, today, we are looking for the same treatment in return from Ottawa.”

The speech traced the familiar themes of Mr. McGuinty’s campaign to claw back more money from Ottawa in order to help revive the ailing provincial economy.

He noted that the manufacturing sector is doing poorly even as other provinces are prospering because of high energy prices. He said rules regarding employment insurance and health transfers need to be changed to treat Ontario the same as other provinces.

And he asked why Southern Ontario, the heart of the manufacturing sector, gets no regional economic development investments like other regions. “Ontario is not being treated fairly by Ottawa,” Mr. McGuinty said.

Noting that the province elects more than one-third of the MPs in the House of Commons, he urged Ontario voters to ask candidates from all parties what they would do to shrink the $20-billion gap.

“We need to tell them we’re not looking for the sheepish, the shy or the shrinking violet,” the Premier said. “We’re looking for eager, enthusiastic, unapologetic supporters of Ontario.”

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