Williams asks N.L. MPs to vote against budget for $1.5 billion 'shaft'

ST. JOHN'S, N.L. - Premier Danny Williams is asking the seven opposition MPs from his province to make a symbolic stand and vote against the federal budget that he says will cost Newfoundland and Labrador $1.5 billion over the next three years.

ST. JOHN'S, N.L. - Premier Danny Williams is asking the seven opposition MPs from his province to make a symbolic stand and vote against the federal budget that he says will cost Newfoundland and Labrador $1.5 billion over the next three years.

Williams is incensed after the federal government introduced provisions in the budget that change the way the federal equalization formula is calculated.

While the province stopped receiving equalization payments last year, it continues to receive money under the 1985 Atlantic Accord. That agreement between Ottawa and Newfoundland sets out the rules for sharing revenue from the province's offshore energy industry and is influenced by equalization calculations.

Newfoundland expected to receive $2.7 billion in Atlantic Accord payments over the next three years, but that will drop to $1.2 billion because of changes to the way the equalization formula is calculated, an official in the province's Finance Department said.

Williams said the change will have a crippling effect on his province's economy. He said the move was designed to "get the maximum shaft on Newfoundland and Labrador" after the province did not re-elect any Conservatives in last year's federal election.

"That's not the way a prime minister should act, that's not the way a federation should be run," Williams said Wednesday, adding that he doesn't regret campaigning against the Tories in the October 2008 election.

"You can never take principle too far."

Williams is now calling on the one NDP and six Liberal MPs to vote against the federal spending plan.

"I would be extremely disappointed if after Newfoundlanders and Labradorians returned six Liberals and one member of the New Democratic party ... if they didn't stand behind the position that protects Newfoundland and Labrador," he said.

Added the premier: "If my vote from Newfoundland and Labrador would defeat this budget, I'd do it in a blink."

But even if the seven MPs in Newfoundland and Labrador vote against it, the budget is expected to pass with the support of the other Liberals and the governing Conservatives.

Earlier, Liberal Leader Michael Ignatieff said the premier's concerns about changes to the equalization formula were justified.

But Ignatieff did not ask for an amendment to the budget, as requested by Williams, to protect the $1.5 billion in Atlantic Accord funds.

In Ottawa, St. John's South-Mount Pearl Liberal MP Siobhan Coady accused Prime Minister Stephen Harper of executing "a heavy-handed and vindictive approach to federal-provincial relations."

Ted Menzies, parliamentary secretary to the federal finance minister, emphasized that the province would be receiving $1.2 billion in Atlantic Accord money over the next three years. But he did not dispute the premier's claims that Newfoundland would lose $1.5 billion.

"This government treats all the provinces the same," he said.

An official for Finance Minister Jim Flaherty did not return messages seeking comment on the premier's claims.

Quebec Premier Jean Charest said he believes the federal budget met some of his government's demands, but added he has trouble accepting the lower equalization payments his province will receive.

Charest said the budget will result in $75 million less than expected for Quebec in 2009-10 and a shortfall of $695 million in 2010-11.

"We want to work with a federal government, not a unilateral government," Charest said in Quebec City.

While Williams and Charest vented their frustration, other premiers expressed satisfaction with Tuesday's budget.

Ontario Premier Dalton McGuinty commended the federal government for changing equalization.

"This prime minister has actually delivered," McGuinty said.

"I'm not going to look this gift horse in the mouth. This is real, it's meaningful and it's coming here just in time."

In Nova Scotia, Premier Rodney MacDonald denied Opposition claims that his province would lose $75 million under the new equalization formula because it would recover that money in a so-called transition payment.

"We have been given assurance that it is being protected, and it's being done through the transition payment this year," MacDonald said during an interview in the Halifax area.

 
 
Latest From ...
Most Popular From ...