Quebec argues Ottawa shorted province $1B in federal budget

Quebec Finance Minister Monique Jérôme-Forget challenged the federal government on its budget figures Tuesday saying the province was shorted a billion dollars in transfer payments.

Province's finance minister says transfer payments too low due to overly optimistic federal estimates

Quebec Finance Minister Monique Jérôme-Forget challenged the federal government on its budget figures Tuesday saying the province was shorted a billion dollars in transfer payments.

As part of the budget announced Tuesday, Ottawa said it would send Quebec $8.36 billion in transfer payments for the 2009-10 fiscal year. 

"Am I happy about the equalization payments? No, I'm not happy," Jérôme-Forget told reporters in Quebec City.

She argues the figure should be $1 billion higher because of projected revenue shortfalls facing her province, and has already called federal Finance Minister Jim Flaherty to express her concern.

"What I am saying is the revenues are going to go down because companies make less profits, because some people are going to be unemployed, because a barrel of oil is no longer $150, it's $44," said Jérôme-Forget.

"Basically, this is why I believe the numbers shown by Mr. Flaherty are highly exaggerated."

She said between now and March, when Quebec will release its own budget, she will have to find ways to make up the shortfall.

Jérôme-Forget would not say Tuesday if Quebec will follow the lead of Ottawa and some other provinces and post a deficit.

"You will see in the budget what I will have to do, and that will be coming soon in the next session," she said.

As finance minister fumes, mayor smiles

In Montreal, Mayor Gerald Tremblay was in a more thankful mood after learning Ottawa will spend $12 billion in helping cities like his deal with infrastructure problems.

In addition to the $212 million on its way for a major upgrade of the Champlain Bridge, Tremblay said his administration will be applying for funding for dozens of other projects including upgrades to the city's aging sewer system.

He said his administration has been working hard in the lead-up to the budget to get the paperwork ready to send to Ottawa.

Tremblay said he has 800 projects on his to-do list for a total cost of $1.17 billion, with costs shared by the three levels of government.

"We are ready for our underground infrastructure. We are ready for our roads. We are ready for public transit. We are ready for sports and leisure-time activities and projects. We are ready also for our libraries," he told reporters.

Tremblay said he was also happy to see Ottawa remove some of the red tape in the application process.

"We have done our homework, and we are ready to kick-start projects that will create jobs. We want to get shovels in the ground and, as a result of that, create as many jobs as possible," he said.

Tremblay then turned his sights towards the province and issued a reminder to the Premier Jean Charest of the need for the province to pitch in its share of any future infrastructure project.

More money on the way for Quebec armoury, railway

Tuesday's budget document made mention of several other projects that will get priority attention in Quebec.

Ottawa intends to spent $2 million to develop a plan for the future of the Quebec City armoury which was destroyed by fire in 2008.

The budget also refers to more money for road upgrades in Quebec City, however no dollar figure was mentioned.

Flaherty also promised to take "a big step forward" on improving rail travel between Montreal, Ottawa and Toronto.

The government announced new funding for Via Rail to add a third track at key locations along the route to allow for more express trains.