TEG - 83 Reforming the Federal Fiscal Stabilization Program ...
The federal Fiscal Stabilization Program is meant to provide financial support for provinces that suffer extraordinary declines in revenues. However, the program only provided $248 million payment to Alberta in 2015-16 in the face of a $8.8 billion decline in revenues, and no support for Saskatchewa...
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| Format: | Article in Journal/Newspaper |
| Language: | English |
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The School of Public Policy Publications
2019
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| Online Access: | https://dx.doi.org/10.11575/sppp.v12i0.68076 https://journalhosting.ucalgary.ca/index.php/sppp/article/view/TEG - 83 |
| Summary: | The federal Fiscal Stabilization Program is meant to provide financial support for provinces that suffer extraordinary declines in revenues. However, the program only provided $248 million payment to Alberta in 2015-16 in the face of a $8.8 billion decline in revenues, and no support for Saskatchewan and Newfoundland and Labrador that have also suffered significant revenue reductions in recent years. We discuss the rationale for a Fiscal Stabilization Program, and three principles that should be adopted in re-designing it: · Payments should be based on declines in a province’s own-source revenues from an average of its past years’ own-source revenues · The program should preserve incentives for provinces to maintain prudent fiscal policies by only covering losses that exceed some percentage of “normal” own-source revenues (a deductible) and then only covering a fraction of eligible losses (co-insurance). · Formulas determining payments should be simple and transparent with no adjustment for changes in ... : The School of Public Policy Publications, Vol 12 (2019) ... |
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