Credits: CHRIS ROUSSAKIS/QMI AGENCY
Canadians have given Quebec a quarter of a trillion dollars in equalization payments since 1957, half of all the money the program has handed out. Over that span of more than 50 years, Quebec has always been the biggest beneficiary, and has never been a net contributor to equalization.
With Pauline Marois and her Parti Quebecois leading in the polls as the province approaches its Sept. 4 election, all that money doesn't seem to have won us friends or influenced people.
Equalization started small, at just $139 million in its first year. But it has grown relentlessly, to more than $15 billion this year, of which Quebec got $7.4 billion. And since Pierre Trudeau jammed it into the constitution in 1982, it would be hard to get rid of.
Supposedly the point of the program is to make sure people in poorer provinces get decent public services. But somehow, no matter how often it's redesigned, Quebec gets about half the money.
At the very beginning, Quebec pocketed only about a third of the cash. But of the $510 billion equalization shelled out since 1957 (in inflation-adjusted 2011 dollars) Quebec has received $253 billion.
So do you think Quebecers are grateful? Or do they say: sure, we get money from Ottawa, but it's only fair because we pay into things like equalization?
You guessed it. And they do pay in. The problem is, they don't pay very much.
The finance department doesn't have straightforward numbers on how much provinces pay into equalization because, unlike programs such as the Canada Pension Plan, equalization doesn't have its own dedicated source of money. It just comes out of the feds' main general revenue account. But we can still work it out, because Statistics Canada has figures on how much each province contributed to general revenue from 1961-2009. (Although the agency says the pre-1981 numbers were calculated on a different and less satisfactory basis.)
When we do the math we find that Quebec has contributed about $107 billion of $510 billion since 1957. Since it has received $253 billion, it comes out $146 billion to the good, which amounts to inhabitants of the province getting back $2.36 for every dollar they've paid in. Some ripoff.
Equalization isn't the only federal transfer program to the provinces, of course. Ottawa hands out about $30 billion a year through the Canada Health Transfer and another $12 billion through the Canada Social Transfer to help provinces with various social programs, plus universities and colleges, plus a program to subsidize the territories and other weird side deals. But equalization is the main source of free money for the provinces to spend any way they like. And Quebec is pocketing the biggest share of it and still snarls.
This year alone, Quebec will take $7.4 billion from equalization while paying in just $2.9 billion. The $4.5 billion it gets free and clear certainly helps the provincial government spend $62.5 billion a year to buy votes with things like subsidized daycare and tuition. Without it, the deficit of debt-ridden Quebec would more than double.
Instead of saying thank you, Quebec politicians and intellectuals turn around and praise the "Quebec model" as more generous and socially minded than the chilly Anglo rest of Canada.