Ottawa Announces a Record $24 Billion in Equalization Payments

Minister of Finance Chrystia Freeland stands during question period in the House of Commons on Parliament Hill in Ottawa, on Nov. 28, 2022. (Sean Kilpatrick/The Canadian Press)

The federal government has announced it will provide a record $24 billion in equalization payments in 2023–24 with Quebec, Manitoba, and Maritime provinces being the main recipients.

Announced on Dec. 15, the latest figure of $23.96 billion represents a $2 billion increase from 2022–23.

Equalization, a federal program that sees the transfer of tax dollars collected by Ottawa from across the country to provinces with lesser ability to raise revenues at given tax rates, will also see Ontario receiving the payment, though the sum is comparably lower than the other receiving provinces.

The latest information released by Finance Minister Chrystia Freeland shows that Quebec will receive the most at $14.04 billion, while Manitoba will get $3.51 billion. Nova Scotia, New Brunswick, and Prince Edward Island will be paid $2.8 billion, $2.63 billion, and $561 million, respectively.

Ontario trails behind PEI with $421 million, expected to be transferred to the province in 2023–24.

Taking into account the population of these provinces in Q3 of 2022 estimated by Statistics Canada, the equalization per capita calculated ranges from as high as over $3,000 to as low as $28.

PEI has the highest payment per person at $3,287, followed by New Brunswick ($3,240) and Nova Scotia ($2,749). Manitoba is at the fourth place at $2,491, followed by Quebec at $1,614. Ontario has the lowest at $28 per person.

Equalization was contested by former Alberta Premier Jason Kenney, who pledged in the 2019 UCP election campaign to remove the federal program from the Constitution.

There has been long-standing grievance in Alberta over the redistribution of wealth to other provinces under the equalization scheme, as contributions from energy-rich Alberta make up a sizable portion of the payments to other provinces.

A poll conducted last October indicated that over 60 percent of Albertans said “yes” to a fair deal from Ottawa.

Andrew Chen contributed to this report.