Speaking Remarks by

The Honourable Dr. Marie Bountrogianni

Minister of Intergovernmental Affairs and

Minister responsible for Democratic Renewal

at the Ethnic Media Association

May 8, 2006

Thank you for joining me. It’s my pleasure to speak with you today.

You’ve probably noticed our government’s campaign for fairness. We are urging the federal government to address the fiscal imbalance and provide equitable treatment for all Canadians, including those living in Ontario.

Fiscal imbalance is a fancy way of saying that the federal government has more money than it needs to meet its responsibilities, for things like immigration and foreign affairs, while the provinces and territories do not have enough money to fulfill their responsibilities, for big ticket items like health care, education, and municipal services.

The fiscal imbalance undermines our ability to invest in the health and vitality of our people. It presents a constant challenge for provinces to deliver important public services.

The fiscal imbalance is not just our opinion. All Canada’s premiers recognize it exists, countless independent studies, and the Prime Minister himself also acknowledges the fiscal imbalance.

That’s the good news – everyone agrees that the fiscal imbalance needs to be fixed.

Our hope is we can work collaboratively with other premiers and the Prime Minister to develop a solution that will benefit all Canadians.

The federal government has just put out a discussion paper on this issue and will be consulting with Canadians and governments across the country over the course of the summer.

I urge you to engage in this dialogue. It is essential that you make your voices heard.

While the country’s fiscal arrangements affect all provinces and territories, they are especially detrimental for Ontario.

It’s challenging for us because such a large percentage of our taxes are

distributed to other parts of the country.

We believe in equal opportunity for everyone. We believe that wherever you come from, your kids should have good schools, your parents should have good health care, your families should have safe streets.

And if you live in Brampton or Scarborough and work in downtown Toronto you should have a public transit system that allows you to make it home to have supper with your family at the end of the day.

We know that everyone in this room – and your readers – works hard, pays taxes, and asks for nothing more than to be treated fairly.

Everyone in this room should know that in our discussions with other

governments on the fiscal imbalance, we are fighting for you, and we are on your side.

Yes, there are needs in other provinces. And every year, taxpayers in Ontario send billions of dollars to other provinces to help fund their schools and hospitals.

We in Ontario are proud to support these services. But we have needs in Ontario too, and we have to make sure we support people in our own province as well.

There are people in need right here in Ontario.

Every year, Ontario receives 140,000 new immigrants – over the half the Canadian total. We need to make sure we retain enough of our own resources here so that each and every person who comes here has an opportunity to make a good life for them and their family.

We are committed to doing everything we can to support them, whether they arrived in Ontario 200 years ago or 200 days ago.

Unfortunately, this has not been the case, as Ontarians have been treated inequitably when it comes to receiving funds from most federal programs.

Ontario currently receives $86 less per person to support health care and postsecondary education and other programs than provinces that receive equalization.

This means there are, in effect, two equalization programs – one that is visible to everyone, and one that’s hidden. This is unfair and it must stop. All Canadians must be treated equally.

Let me illustrate with a few other examples:

An Ontarian with a bad hip is no less a Canadian than someone in Quebec with a bad hip.

Yet Ontario gets $181 less per hip replacement than the other provinces.

A college student in Ontario is no less a Canadian than her counterpart in PEI.

Yet Ontario receives $104 less per college student than other provinces.

A disabled Ontarian is no less a Canadian than a disabled person in Manitoba, for example.

And yet Ontario receives $361 less per disability support case than the other provinces.

How should Canada address these problems?

We support addressing the fiscal imbalance in a way that’s fair to all Canadians –

including those living in Ontario. A solution that helps half the country by making the problem worse for the other half is no solution.

Specifically, we simply want the federal government to treat all Canadians equally when it comes to transferring funds to provinces to deliver programs and services.

We also want the federal government to ensure that all provinces, territories, and municipalities have more resources to deliver programs and invest in their people.

This would mean increasing federal transfers on an equal per capita basis, or transferring tax room to the provinces.

What this means is that the federal government keeps fewer of the dollars collected and the provinces retain more of the dollars – but the burden on taxpayers doesn’t change.

Our government has been working diligently to make sure things get “rebalanced.”

But the message must come from more than just the Ontario government. It must come from the Ontario people, Ontario businesses, Ontario families, Ontario municipalities, and Ontario stakeholder groups.

It must come from all of us.

With regards to the Equalization program – Ontario is proud of our historic and continued commitment – in financial and moral terms – to ensuring that all Canadians have access to quality public services.

There are some who suggest we need to make the Equalization program larger.

The Constitution includes the principle that Canadians in different parts of the country have access to reasonably comparable levels of public services at reasonably comparably levels of taxation.

Ontarians have always supported this principle – with our hearts and with our pocketbooks.

Canadians living in Ontario currently put $4.7 billion into the equalization

program. That contribution has grown 30 per cent over the past four years, and is scheduled to grow at 3.5 per cent a year into the future – regardless of what happens to the economy.

There is no evidence the current size of the Equalization program along with already agreed to growth, is insufficient to meet the constitutional principle.

To suggest this province is not doing its part to support other regions of the country does a disservice to the Ontario taxpayers who continue to pay into the program to support their fellow Canadians.

Despite that, some are calling for a much bigger Equalization program that would increase Ontario’s contribution to $6.5 billion. That would mean that a family of four that current paid $1,486 annually would see that payment increase to $2,075 per year. That is simply not affordable.

Another big increase to Equalization would help some provinces but it would hurt Ontario.

Some other provinces’ economies are growing faster than our own and every other provincial government spends more per capita on programs like postsecondary education than Ontario does.

Some provinces that receive equalization now have lower tax rates. Some have even greater fiscal capacity overall than Ontario.

There is simply no principle-based rationale to ask Canadians who live in Ontario to send more to other provinces, when we have such pressing needs here in Ontario.

The old notion that if there is a problem in the country you can just take more money from Ontario taxpayers and ship it to other parts of the country is no longer viable.

It is not that Ontario has had a change of heart, but Ontario, Canada, and the world are vastly different places than when we put in place our fiscal arrangements.

The old model was meant to create fairness across the country by redistributing wealth generated from the have-provinces.

This model is now actually creating more unfairness than it is alleviating, and Canadians who live in Ontario are experiencing this in a real way.

Our discussions on the fiscal architecture need to be comprehensive and forward-looking, by considering:

how the fiscal arrangements support the country’s ability to create wealth in a competitive global economy; the importance of investing in cities; and, how our system of transfers to individuals through programs like Employment Insurance fits into the overall fiscal architecture.

Our bottom line is that federal transfers outside equalization – including transfers for health, education, and infrastructure – should treat all Canadians equally.

And that all provinces need a greater share of resources to invest in their future prosperity.

We are looking forward to working with our federal, provincial, and territorial partners to build a national consensus on measures to address the fiscal imbalance.

We are going to work as long and as hard as we can with them to address the fiscal imbalance in a way that is fair to all Canadians -- including hardworking proud Canadians here in Ontario who pay their taxes and play by the rules.

Those solutions have to ensure that Ontario can meet its challenges. I believe everyone knows that this is the right thing to do for Canada’s future.

The Premier and I both know that the people of Ontario work hard and play by the rules.

They pay their taxes to the federal government and this money goes to improving the quality of life in every corner of this country.

They do this proudly. But they deserve to be treated fairly by their governments, and some of those rules are unfair to Canadians living in Ontario.

I believe we have an historic opportunity to build a new fiscal relationship between levels of government that will respect and recognize their hard work and their contribution -- and benefit the whole country.

Let me assure you that the Government of Ontario is committed to finding solutions to the fiscal imbalance that are work for all Canadians, including those living in Ontario.

The federal government and all provincial and territorial governments can count on the support, honesty, and goodwill of the government of Ontario – and, as always, the people of Ontario -- as we move forward in discussions on addressing the fiscal imbalance.

But what this means is that the federal government can’t just tell us to go ahead and fix our health care, fix our schools, fix our colleges and universities – but then prevent us from retaining enough of our own resources – the hard earned money of Canadians who live in Ontario – to do the job.

Ontario faces many challenges to invest in our education, health, and

infrastructure system. A high dollar, rising interest rates and high petroleum prices are new facts of life. We need to keep sufficient resources here in Ontario to ensure we can continue to offer our residents good quality public services and a prosperous life.

Ontario and Canada are prosperous societies, but we must not remain

complacent.

We do not have a birthright to our good fortune.

We must work on it and invest in it. Sound economic and social policies are necessary to ensure that our standard of living continues to grow.

We need to ensure that Canada is not only a place where we redistribute wealth, but a world leader when it comes to creating it as well.

Ontario believes our fiscal arrangements must enhance Canada’s

competitiveness and ensure prosperity for future generations of Canadians.

Thank you.