Time for Quebec to end equalization addiction: Montreal think-tank

National Post | News

Quebec may not be able to keep its gold-plated welfare state, but either way, it is time to break the province’s 55-year “welfare trap” addiction to equalization payments, according to an economic note by the Montreal Economic Institute.

“Quebecers are well aware that we’re a have-not province, and there’s no pride in this,” said Yourri Chassin, an economist with the Institute.

The four page note, released Tuesday, calls for Quebec to ramp up oil, shale and electricity development, while simultaneously calling on Ottawa to grant the province a five to eight year “grace period” before clawing back equalization payments.

“There’s a bit of incentive needed to kickstart this process,” said Mr. Chassin.


Under the current equalization regime, Quebec stands to lose 50 cents in equalization payments for every dollar it collects in resource revenues. Mr. Chassin argues that the formula is subtly hindering the province’s willingness to approve mines…

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