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April 26, 2001
For immediate release

Minister Mella Joins Atlantic Finance Ministers in Ottawa

Provincial Treasury

The Provincial Treasurer, Patricia Mella, is in Ottawa today, together with her provincial colleagues from the Atlantic Provinces to make representations to the federal government to remove the ceiling from equalization entitlements in future years. The Federal Finance Committee is presently reviewing Bill C 18, an act to amend the Federal/Provincial Fiscal Arrangements Act, which will entrench the ceiling in the Equalization Program in 2000/2001 and future years.

"It is unusual for provincial ministers to make representations directly to committee members but this is a most critical issue for the Atlantic provinces as it goes against the very principles underlying the constitutional obligation of the federal government to uphold the Equalization Program," said Minister Mella. She added that, "the Minister of Finance from Manitoba, Greg Selinger, is also speaking to the committee later today."

The essence of Bill C 18 is to remove the ceiling for 1999/2000, as part of the First Ministers' Agreements of last September, and then to reimpose it in 2000/2001 and future years. It effectively lowers the ceiling by $1.1 billion per year and will have serious negative impacts on provincial entitlements in those years.

"The Premier and I cannot believe that the federal government would reimpose the $10 billion ceiling in future years, following the Prime Minister's commitment to lift it in 1999/2000 to allow the program to grow to the rate of growth of Canadian GDP," said the minister. The Atlantic Premiers have already sent a letter to Prime Minister Chrétien expressing their concerns over Bill C18.

"It is the hope of Atlantic Finance Ministers that Finance Committee members will heed our presentations and those of our Manitoba colleague, and accept our proposed amendments to Bill C18," said the Provincial Treasurer.

For additional information on the ceiling on equalization payments see the following Web site:

Media Contact: Island Information Service
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