A new deal for Nova Scotia

This comes out just a day after Danny Williams wins a landslide election victory. Coincidence?

Prime Minister Stephen Harper and Premier Rodney MacDonald ended their offshore revenue dispute yesterday with an agreement that lets Nova Scotia choose a special equalization formula.

It does not keep all the terms of the Atlantic Accord former premier John Hamm negotiated in 2005, but provincial officials say it could pay out more money, eventually.

The two leaders also promised to settle a separate revenue-sharing dispute between Nova Scotia and Ottawa that dates back to the 1980s.

"I've always told Nova Scotians that we would not lose one red cent from the accord," MacDonald told reporters in Ottawa. "Our two governments are reaffirming that here today."

The agreement to settle the long-standing Crown share dispute allowed Harper to argue he's now being fairer to Nova Scotia than previous prime ministers.

"We always said we would respect signed agreements, signed accords," he said in French.

Harper offered the same equalization deal to Newfoundland and Labrador, but there is no Crown share dispute to arbitrate with that province. He said it's up to Premier Danny Williams whether he "accepts that reconciliation."

Williams quickly rejected the offer. "The bottom line here is that Nova Scotians have said yes to less," he said.

[...]

The province will initially get less than it demanded, but finance officials said the agreement reached yesterday will pay Nova Scotia more money than it hoped to pocket over the lifetime of the accord. The reason is the old program grows at 3.5 per cent, which is expected to eventually outpace growth in the new formula.

The new deal is projected to catch up to Nova Scotia's demands nine years from now. By 2019-20, it could be worth a total of $229 million more. That's almost one per cent of the $25.6 billion in equalization Nova Scotia expects to collect over the period.

Danny, not surprisingly, is crying foul. Ed Hollett, no fan or Williams or Harper, thinks Nova Scotia is getting a pretty good deal - but Newfoundland and Nova Scotia are not in exactly the same position.

Williams's bluster gained him 43 seats in an election he would have easily won anyway. But what has it done for anyone else?

Damian P.

Posted by damian at October 11, 2007 10:27 AM