Federal-Provincial Fiscal Arrangements Act

Marginal note:Fiscal equalization payments

• 4.1 (1) The fiscal equalization payments to the provinces

  • (a) for the fiscal year beginning on April 1, 2005, shall equal $10.9 billion;

  • (b) for the fiscal year beginning on April 1, 2006, shall equal the product obtained by multiplying $10.9 billion by 1.035; and

  • (c) for each subsequent fiscal year, shall equal the product obtained by multiplying the fiscal equalization payment for the immediately preceding fiscal year by 1.035.

• Marginal note:Provincial allocation for fiscal year 2005-2006

  (2) The fiscal equalization payment referred to in paragraph (1)(a) shall be allocated to the provinces as follows:

  • (a) to Quebec, $4,798,070,000;

  • (b) to Nova Scotia, $1,343,527,000;

  • (c) to New Brunswick, $1,347,993,000;

  • (d) to Manitoba, $1,601,018,000;

  • (e) to British Columbia, $589,698,000;

  • (f) to Prince Edward Island, $276,563,000;

  • (g) to Saskatchewan, $82,172,000; and

  • (h) to Newfoundland and Labrador, $860,959,000.

• Marginal note:Provincial allocation for fiscal year 2006-2007

  (2.1) The fiscal equalization payment referred to in paragraph (1)(b) shall be allocated to the provinces as follows:

  • (a) to Quebec, $5,539,296,000;

  • (b) to Nova Scotia, $1,385,539,000;

  • (c) to New Brunswick, $1,450,799,000;

  • (d) to Manitoba, $1,709,430,000;

  • (e) to British Columbia, $260,228,000;

  • (f) to Prince Edward Island, $291,262,000;

  • (g) to Saskatchewan, $12,723,000; and

  • (h) to Newfoundland and Labrador, $632,223,000.

• Marginal note:Provincial allocation for subsequent fiscal years

  (3) With the approval of the Governor in Council, the fiscal equalization payments referred to in paragraph (1)(c) shall be allocated to each province in the proportion that the Minister considers appropriate. The approval of the Governor in Council shall be given once in respect of the three-month period beginning on April 1, 2007 and once in respect of each subsequent three-month period, within three months before the beginning of each of those periods.

• Marginal note:Upward adjustment of fiscal equalization payment for the fiscal year 2006-2007

  (3.1) If the fiscal equalization payment for the fiscal year beginning on April 1, 2006 to which a province is entitled under subsection (2.1) exceeds the fiscal equalization payment that was paid to that province in accordance with the allocation determined under subsection (3), as it read on April 1, 2006, an amount equal to the difference may be paid to the province at the times and in the manner that the Minister considers appropriate.

• Marginal note:Overpayment made to a province for the fiscal year 2006-2007

  (3.2) If the fiscal equalization payment for the fiscal year beginning on April 1, 2006 to which a province is entitled under subsection (2.1) is less than the fiscal equalization payment that was paid to that province in accordance with the allocation determined under subsection (3), as it read on April 1, 2006, the Minister may recover the amount of that overpayment

  • (a) from any amount payable to the province under this Act in that fiscal year or as soon as possible after the end of that fiscal year; or

  • (b) from the province as a debt due to Her Majesty in right of Canada.

• Marginal note:Time and manner of payment

  (4) The fiscal equalization payment shall be paid to the province in equal monthly instalments on the first and third working days after the 15th day of each month during the relevant fiscal year. For the purpose of this subsection, “working day” includes any day that is not a Saturday or a holiday.