Payments to recipient provinces are increasing even as the gap between richer and poorer provinces shrinks.
equalization program
According to forecasts, overpayments will account for 35 per cent of the program’s cost in 2025/26.
Ottawa raised $280 billion more from Albertans than it spent in Alberta from 2007 to 2019.
Reforms in the 1990s led to a marked decline in welfare dependency and reduced spending on social assistance.
Alberta received just $249 million in payments despite a revenue loss of $7.2 billion.
Currently, equalization payments increase in line with nominal GDP growth.
In 2019/20, equalization comprised 21 per cent of provincial government revenue in Prince Edward Island.
The three Maritime provinces rely more heavily on federal transfers than any other province.
As a share of the province’s total government revenue, New Brunswick’s equalization payments fell from 23.7 per cent to 19 per cent.