Stephen Harper announced today that he has reach deal with Nova Scotia Premier Rodney MacDonald over offshore revenues. In doing so he claims to have successfully ended an ongoing dispute by guaranteeing the province it will not lose revenue from its Atlantic Accord contract due to changes in the equalization formula brought into effect in the last federal budget.
Anyone who doesn't believe Stephen Harper is an astute politician should look again.
With an election in the air Harper has essentially convinced Premier Rodney Macdonald to sell out his province on this issue in order to help the federal Conservatives win the next election and to protect the career of Federal MP (and Defence Minister) Peter MacKay.
The new "deal" does nothing to address the fact that Harper promised to leave 100% of non-renewable resources out of the equalization formula and didn't.
The new "deal" allows the province to either participate in the new equalization formula OR remain in the Atlantic Accord using the old and less valuable 2005 formula. It will allow them to move in and out of either option during the lifetime of the Accord agreement. This is essentially the same choice already offered to Nova Scotia by Stephen Harper when he first left the accord in tatters. It just extends the ability of the province to move in and out over a slightly longer period of time.
The new "deal" doesn't allow Nova Scotia to participate in the current equalization formula and keep the accord, even though the accord contract itself clearly states that is exactly what is supposed to happen.
The only potential value of this new "deal" for Nova Scotia may be in finally getting some kind of settlement on royalties already owed to the province by Ottawa for decades but never actually paid. A panel will determine the amount owing and both parties will be bound by that decision. No doubt it won't be the full amount and even after the board makes its determination Nova Scotia will still have to depend on Ottawa to pay up, something they refused to do the first time around.
Of course by the time that decision is made the federal election will be long over leaving the province with less leverage to extract money from Ottawa than they do now.
The timing of this announcement is perhaps as interesting as its contents. Coming when federal election speculation is in the air, the day after a huge election result in Newfoundland and Labrador, while Ontario is at the polls, within a day or so of an election in Saskatchewan and while the House of Commons is not sitting. It almost seems the PM wants this to slip through without anyone paying too much attention to it.
