Equalization: What's Next
The Bloc fallacy on redistribution, a partial win in Manitoba court, and my swearing-in
Equalization: What’s Next?
On October 18, 2021, Albertans made history by voting in favour of removing equalization entirely out of the Constitution of Canada. This was the first time that Albertans had been directly asked to weigh in through a non-binding referendum on equalization. For decades, equalization (and the transfer system in general) has been a heated point of political debate, both sides sometimes engaging in over-the-top rhetoric or using it to score political points. I believe the vote outcome in favour of removing equalization from the Constitution is meaningful as it confirms that this is not just a talking point of the political class but also of everyday Albertans.
First, a few observations on this vote. While 61.7% voting in favour may not seem like a crushing victory to move on constitutional reform, it actually is and when was the last time Albertans had ever voted so convincingly on a political matter? Any local candidate would be downright thrilled to receive such a vote percentage taking it to mean they have a strong mandate to carry out their promises. While the voter turnout was below 50%, it is still historically high for a municipal election. This despite voter fatigue from a federal election that preceded this municipal vote by a month and the on-going pandemic that has not abated. This is indeed a mandate for the provincial government to seek an amendment to the Constitution and significant changes to the equalization formula. I have seen some pundits claim that a fraction of the population voting in favour does not give the Alberta Premier political marching orders, but I entirely disagree. That’s not how elections work. Those who show up and cast votes are the one’s making the decisions for everyone else. In fact, in Calgary 218,856 voted yes in this equalization referendum which is much higher than the 176.344 votes received by Mayor Jyoti Gondek in her successful election; nobody is claiming her legitimacy is reduced due to these numbers or her claim that she won 45% of the vote (she did). Likewise, the newest Mayor of Edmonton, Amarjeet Sohi, won with 105,683 votes which is slightly under the total equalization yea vote of 108,059. His legitimacy as mayor is also not called into question and he too won with 45% of the vote. And as an interesting vignette to all this, the equalization referendum vote was actually won by the no side in Edmonton with 116,632 residents voting nay.
Second, let’s also admit that this referendum vote was held in unusual circumstances. I already mentioned the on-going pandemic and the voter fatigue from the federal election. I will also point out that neither side had any big-budget organizations or large advertising campaigns promoting the yea and nay side of the vote. In comparison to the Quebec secession vote in 1995, which yes it had much larger stakes, also hard huge publicity campaigns on both sides. This equalization referendum was left to voters to do their research and decide on the balance of their own knowledge how they felt on this matter. There were organizations like Dr. Bill Bewick and the excellent ideas at Fairness Alberta’s website that advocated for while professor Trevor Tombe provided the counterpoint for the nay side mostly on his Twitter account. The scrappy Canadian Taxpayer Federation has its own campaign here. This is all to say that with a larger publicity campaign and larger organizations backing either side we could have seen a larger vote total especially for the yes side of the question.
So now what? We Albertans voted to remove equalization from the Constitution of Canada, so what happens now? I think the first step will be for the Alberta Legislature to formally recognize the outcome of the vote by putting forward a motion that essentially amends the Constitution. Like for the Meech Lake Accord, the provinces had to pass motions to formally amend the Constitution under the general formula that is generally referred to as 7 out of 10 provinces making up more than 50% of the population of Canada. There are other ways to amend the Constitution of Canada, both unilaterally and by the Parliament of Canada, but those have narrow scopes of impact specific to a province. If such a motion were to pass the Alberta Legislature, and there is no reason it should not, then it would form a model of the wording that other provinces could then follow in their respective provincial legislatures. Thereafter, the next step would be for the provincial government to formally request to negotiate with the federal government on a new federal-provincial arrangement for equalization and transfers. This was partly the idea behind my private member’s bill in the last Parliament, C-263, and there is truthfully no reason the province of Alberta cannot seek both an amendment to the Constitution concurrently with seeking changes to the equalization formula. Equalization has existed as a federal program since 1957. Alberta stopped collecting in 1965 and has been a large net contributor to the financial resources shared across Confederation. The sharing principle of equalization was added to the Constitution in 1982. Equalization has on average seen significant changes every decade and the last major change to the formula came in 2014 with the next expected potential for revisions in 2024. There is no reason that the federal government has to wait until 2024 and there are significant reasons to revise the formula earlier as the financial conditions across provinces has changed significantly. As outlined by the Fraser Institute in their report on equalization convergence, Alberta has lost financial capacity and is now hovering around 20% above the average – and this is before the pandemic.
So there you have my take on the latest developments on equalization. Removing Equalization from the Constitution is not going to happen overnight and will not fix the fiscal imbalance between Edmonton and Ottawa immediately. There are some reasonable amendments that can be made (like deleting entirely the fixed growth rate rule, modifying how hydro rates are calculated, and other fiscal calculation measures) that would improve the fairness and perceived fairness of equalization. Moreover, it could also unlock financial resources to be distributed more evenly across the provinces for healthcare as the share of federal spending has dropped from the once promised 50% down to the 22-28% range. Additionally, more can and should be done for equalization to support provinces like Newfoundland and Labrador that are facing fiscal calamity as outlined in the Moya Greene Report. There is lots yet to be done, proposals for legislation (like I have done in the past), negotiations between Edmonton-Ottawa, and further fiscal proposals to be hashed out in public. The equalization referendum just proves that it’s not only Alberta politicians that care, but that they reflect the will of the Alberta electorate as well.
The Bloc Fallacy on Seat Redistribution
This week, Bloc Quebecois Leader, Yves Blanchet demanded that Parliament ensure that Quebec does not lose a seat in the upcoming redistribution. Blanchet doesn’t understand how Elections Canada made this decision and thankfully it’s based entirely on an impartial formula passed in 2012 by the Harper government. This is simple math. Let me explain.
The constitution stipulates that the seats in the House of Commons need to be redistributed after every census which occurs every decade. There are essentially four phases in which provinces can get seats.
First is representation by population. Using the census and percentage population growth Elections Canada establishes the target number of people in each riding. The last redistribution the target electorate was 111,166. Based on population growth, the new electoral quotient is 121,891. The population of every province is then divided by the quotient to provide the initial seat allocation. Because Alberta’s population increased, it gained 3 more seats, and because Quebec’s population didn’t increase at the same rate as other provinces it lost seats.
The next way seats are allocated is based on the senatorial clause. This practice dates back to the early days of Confederation. No province can have fewer seats in the House of Commons than they have in the Senate. Neither Quebec nor Alberta gains seats in this phase. This phase adds additional seats to Atlantic Canada and is why Atlantic Canada is overrepresented in Parliament.
The third way seats are allocated is through the grandfather clause. This clause guarantees that no province has fewer seats than it had in 1985. This adds seats to Manitoba, Saskatchewan, Quebec, Newfoundland, and Nova Scotia.
The last rule is the representation rule which only applies to Quebec. This rule states that any province whose population was overrepresented at the completion of the last redistribution and would now be underrepresented in the House of Commons will be given extra seats so that its share of seats in the House of Commons is equal to its population proportion. Because Quebec was overrepresented, now it receives two additional seats, so that its proportion of population equals its proportion of seats. In this newest Elections Canada apportionment of seats, we have now moved closest to representation by population for Quebec and nearly so for Alberta.
Even in this newest redistribution, Alberta, Ontario, and British Columbia will continue to be underrepresented but much less so than a decade prior.
Should there be any changes proposed in Parliament by the Liberal government to the apportionment of seats away from the Harper 2012 formula then I will make the case for apportioning seats to representation by population for every province in Confederation. You can see the full breakdown of how this would look below.
A Partial Win in the Manitoba Court
Last week, Manitoba Court of Queen’s Bench Chief Justice Glenn Joyal released his ruling on a case brought forward by a group of churches arguing that the provincial pandemic health restrictions violated their charter rights.
The judge acknowledged that the pandemic restrictions violated section two charter rights regarding freedom of religion and freedom of assembly. However, the judge ultimately ruled that these infringements were, “constitutionally justifiable as reasonable limits under section one of the Charter.” The judge explored the evidence from public health experts and found that the spread of the pandemic justified the infringement on rights as is the ability of government under section one of the Charter.
Officially Sworn in as the Member of Parliament for Calgary Shepard
I was honoured this week to be sworn in as the Member of Parliament for Calgary Shepard. This is not a responsibility that I take lightly. My constituents have sent me here to fix equalization, stop increases to the cost of living, get inflation under control, ensure the practice of making Canadians unemployed for refusing a vaccine stops, press for ethical government, and practice fiscal prudence. I will work hard for constituents to keep the government accountable and transparent.
It’s time for the Liberals to end their vacation and get Parliament back to work.