Tweak equalization program during oil price slump, Jack Mintz suggests
Ottawa could compensate for imbalance hurting energy-dependent provinces
A Calgary economist agrees that oil-dependent provinces like Alberta could use a break when it comes to the country's equalization program.
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Saskatchewan Premier Brad Wall said earlier this week the federal government should consider returning a portion of the money it collects from so-called "have" provinces while energy prices are low.
That cash is collected by Ottawa so it can then spread the wealth more evenly across the country.
Wall says the problem is there is a lag in the calculation, which leaves provinces like Saskatchewan and Alberta at a disadvantage now that they are struggling with low oil prices.
Jack Mintz, an economist at the University of Calgary's School of Public Policy, says Wall has a good point.
"Something should be considered. In fact, at one time, there was always a stabilization program, so that if a province dropped a significant amount of revenue in one year, the federal government could give stabilization revenues," Mintz said on The Calgary Eyeopener.
"And I think actually that would be the answer, for the federal government to consider bringing back the stabilization program — at least something temporary while the equalization program catches up with the times."
Wall suggested the money could be used for infrastructure projects or worker retraining programs.