A Quebec finance minister cracking down on spending is usually expected to launch a war with Ottawa to extract federal billions and minimize painful cutbacks at home.
Not this time.
Finance Minister Carlos Leitao’s budget unveiled Wednesday contained an entire chapter dedicated to the ways the Conservative government has unilaterally shrunk its role in contributing to provincial finances. So will Mr. Leitao return to the tactics of a previous Liberal government that launched daily salvos against Ottawa for hogging all the revenue while the province struggles to pay the bills?
“No,” said Mr. Leitao. “The federal government ultimately decides how it transfers its revenue to the provinces.”
Even the federalist Quebec Liberals under Jean Charest spent large portions of 10 years in power decrying the “fiscal imbalance” that it said left Ottawa collecting more taxes than it needs while the province paid for most big-ticket items such as health care.
The 2014 Liberal government is taking a more collaborative approach.
“These are federal programs. We understand that. But we think the provinces – all provinces – should have a say in how the formula works,” Mr. Leitao said.
Even the prospect of looming federal surpluses and Prime Minister Stephen Harper dangling tax cuts in time for an election expected in 2015 could not bait Mr. Leitao.
“How the federal government will choose to use its surpluses is its choice,” he said.
In Quebec’s case, the government says caps on equalization payments introduced in 2008 will cost the province just over $1-billion next year and other rule changes will cost hundreds of millions in social transfers.Report Typo/Error