Ontario, Oil

The recommendations of the O’Brien Report deviated significantly from that mandate, arguing instead for “a clear set of principles” for Equalization, starting with the use of a formula to determine both the size of the Equalization pool and the allocation to individual provinces. [...] If the current slate of Equalization-receiving provinces were to all to deviate from the standard by only one dollar in per capita terms, the cost to the federal government to equalize them to the standard would vary considerably from province to province. [...] Cap GDP Ceiling 8,000 The combination of the 7,000 change to the FCC and the introduction of the GDP ceiling 6,000 allowed for Ontario to qualify 5,000 for Equalization payments NL PE NS NB QC ON MB SK AB BC while containing the costs of Source: Mowat calculation based on Finance Canada data the program. [...] Constraining the program to a fixed envelope has the effect of divorcing the Equalization standard from the determination of the total size of the program. [...] RECOMMENDATION #2 Starting in 2019-20, return to the use of a single formula to determine both the size of the Equalization pool and the allocation to individual provinces, as recommended by the Expert Panel on Equalization.