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Not surprisingly, leaders from both the UCP and NDP in Edmonton were disappointed by the minister’s decision to only adjust that cap for inflation ($170), but the premier took criticism for calling it a “slap in the face.” University of Calgary economist Trevor Tombe analyzed these changes in the magazine Policy Options where he suggested the premier’s reaction was “overdramatic.” What his otherwise helpful article fails to mention explicitly, however, is that at the end of 2019 Alberta managed to get the unanimous support of all 13 premiers to not only lift the cap entirely (which they could all benefit from) but to make it retroactive to 2015 in order to compensate Alberta in particular.
Any political watcher can confirm that it is not unusual to see premiers unanimously call for more money from Ottawa. What is unusual is seeing them use political capital for the sake of only one province.
While unusual to obtain, the broad support for a specific payment to Alberta is easy to justify. Albertans have been providing “fiscal stabilization” to federal finances every year for 60 years; $600 billion more has come from Alberta tax revenues than has been spent back in Alberta over that time. This is hardly just a boom-time phenomenon, either: over the last five years, Albertans have sent $90 billion to Ottawa that was spent on people, governments and infrastructure in other provinces.
Looking again at 2015, which started off strongly for Alberta, the net total Ottawa enjoyed from Alberta taxpayers to stabilize its budget was a staggering $25 billion. When the $8 billion, or 20 per cent, drop in provincial revenues hit Alberta later that year, the stabilization payment of $250 million meant Ottawa sent back to Albertans exactly one per cent of their net contribution despite the economic collapse.
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