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Federal Finance Minister Jim Flaherty has never been shy about telling the Ontario government to reduce its expenditures, yet his own government is adding billions to Ontario’s expenditures. Not only will the Conservatives’ crime bill dump the costs of implementing the omnibus legislation onto the backs of provinces but a report commissioned by the federal government reveals that Ontario is short–changed by the equalization formula.
Ontario’s Community Safety Minister Madeleine Meilleur estimates the Conservatives’ new federal omnibus crime legislation will add another 1,500 prisoners to the corrections system, force the building of another prison, put pressure on parole officers and tie up police officers’ time in courts instead of on the streets. Bill C–10, which received third reading in the House of Commons last month and is currently being reviewed by the Senate’s Legal and Constitutional Affairs committee, may require building a new 1,000 bed facility to handle the influx of new prisoners the legislation will create, Meilleur said. Prisons are already crowded and operating at 95 percent capacity with 8,500 inmates, she added.
The cost of a new prison is about $900 million and operating the facility would cost another $600 million annually, she said, adding Ontario can’t afford to pay for these costs at a time when its trying to get its deficit down. “Let’s be very clear,” she told a Toronto Star reporter. “My government believes in community safety and crime prevention. But it is just unacceptable that Ontarians are expected to bear the costs of federal anti–crime legislation. They are tough on crime but aren’t willing to pay for their tough talk.”
This crime bill combines new previous pieces of legislation into one and will make fundamental changes to the entire justice system. The bill includes tougher sentences on child sexual predators and introduces mandatory minimum sentences for some drug crimes. The changes will put serious stress on the justice system for police officers who’ll be spending more time in court, parole workers and correctional staff, Meilleur said. Some jails will be so crowded they could be operating at almost 150 percent capacity, she added, and another 1,000 people could be placed on parole.
NDP Justice critic Jagmeet Singh (Bramalea–Gore–Malton MPP) agrees that some aspects of the bill, such as mandatory minimum sentences and getting rid of community service and rehabilitation programs, affect Ontario in a substantial way. Reforming the justice and corrections system, not simply putting more people in jail is what’s needed, she said. “In Ontario we build schools, we don’t build jails,” Meilleur said. “We are in the process of modernizing our system. There are jails we have in place that were built before Confederation.”
Meilleur buttonholed Public Safety Minister Vic Toews on the issue during last week’s meeting of federal, provincial and territorial justice ministers in Prince Edward Island. She said if Ottawa wants these changes then they should provide additional funding to help the provinces pay for it. “We expect Ottawa to do what’s right and provide additional funding to help Ontario deal with the consequences of Bill C–10.”
Singh pointed out the Conservatives failed to properly consult with the provinces, police chiefs and Crown attorneys on the legislation. “The police themselves are indicating this crime bill is irresponsible and wasn’t properly thought out,” he said. “The Canadian government should be footing the bill.” But Ontario Conservative Leader Tim Hudak said Meilleur’s figure is more about “bashing Ottawa” than anything else. “Let’s get real,” Hudak said. “There’s only one taxpayer. So I suspect this sounds like more language from the [Dalton] McGuinty Liberals to try to avoid their own problems in reducing costs and foist them on to somebody else.”
If Ontario does indeed have to build a new prison, how about locating it in Niagara Falls, the riding of federal Justice Minister Rob Nicholson. After all, constituents there overwhelmingly supported Nicholson’s re–election bid so they obviously believe we’re being too soft on criminals. They should thus do their part and host a new prison. There’s land available near Marineland. But if Niagara Falls doesn’t work out, the next best location would be in Niagara West–Glanbrook, the provincial riding of Hudak, who championed a chain gang proposal in October’s election, and the federal riding of MP Dean Allison, a Conservative backbencher. Besides where better to locate a new prison but in a Conservative–held riding that also happens to be part of Ontario’s Bible belt.
While Meilleur was voicing her concerns with the crime bill, the Toronto Star got its hands on an unedited 67–page study written in 2006 by Peter Gusen, then director of federal–provincial relations in the federal finance department, that reveals Ontario is being short-changed by Canada’s $15.4 billion–a–year equalization system that redistributes taxpayers’ dollars to ensure equivalent levels of health, education and other programs across the country. The report concludes that Ontario and British Columbia lose out because it’s much more expensive to live and work in those provinces while conversely Quebec and the Maritimes, where the cost of living is cheaper, reap disproportionate benefits.
“’Poor’ provinces are not generally needy. British Columbia has the highest expenditure need per capita and Quebec the lowest,” Gusen wrote. “Cost matters as much or more than work load. Ontario and B.C., typically regarded as ‘rich,’ are invariably the high–cost provinces. As a result, they are more often than not the most needy.”
While the report, entitled “An Operational Expenditure Need Equalization Formula for Canada,” was completed in the dying days of former Prime Minister Paul Martin’s government, a heavily redacted version wasn’t released until 2010 when Matthew Mendelsohn, director of the Mowat Centre for Policy Innovation at the University of Toronto, sought its release using freedom of information laws. One of the things blacked out from the copy Mendelsohn received was an “overall expenditure need” diagram that showed in an average year from the late 1990s to the early 2000s, Ontario needed $4.56 billion more than it was getting while Quebec required $6.39 billion less to provide the same level of services.
“The report makes it increasingly clear that because of the policies of the government of Canada, Ontario families are subsidizing programs and services in other parts of Canada that Ontarians themselves do not enjoy,” Ontario Finance Minister Dwight Duncan wrote in a letter to Flaherty in which he urged the feds to lift the secrecy surrounding the study. “We’ve always said that the equalization formula penalizes Ontario,” Duncan told reporters from Washington, where he was attending pre–budget meetings. “The system in use is inherently biased against Ontario. This year, for instance, we’re putting in about $6 billion and then getting back $2.2 billion. That does rise next year to $3.2 billion.”
Flaherty’s office would not commit to releasing the complete report. But a federal official said Gusen’s study has since been surpassed by another report. “The report in question was prepared in 2005–06, well before our Conservative government’s landmark changes to the transfer system and before Ontario qualified for equalization for the first time ever,” said a senior official, insisting “the report that matters” is a 147–page review led by former Alberta deputy treasurer Al O’Brien in May 2006.
O’Brien’s panel said equalization should continue to focus on provinces’ “fiscal capacity” instead of their respective spending needs. “There is no conclusive evidence that it would have a material effect on the size and allocation of equalization payments,” O’Brien’s report stated. Ottawa now limits increases in equalization payments to the rate of growth in the economy and Ontario, which has a $16 billion deficit, is now considered a “have–not” province thus receives $3.26 billion from the program. That’s less than half of the subsidy Quebec receives: $7.30 billion.
While it’s likely the federal Liberals would have redacted the report if they were still in power, it should be pointed out that Flaherty argued much the same thing when he was Ontario’s Finance minister under Mike Harris. Duncan even used a line very similar to one Flaherty himself used: “The system is completely skewed against Ontario.” Guess he expects us to have short memories. Next time he tries to tell Ontario how to handle its finances, he should remember 2001 wasn’t that long ago. V
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