PROVINCE LAUNCHES CONSTITUTIONAL CHALLENGE

Seeking fairness and equity for the people of Saskatchewan, Premier Lorne Calvert's government today announced that it has launched its Reference to the Saskatchewan Court of Appeal over unfair treatment under the federal equalization formula.

"We make this challenge based on what we believe is right," Calvert said. "It is completely and demonstrably unfair that the hard-working people of Saskatchewan are being deprived of the benefits of their own non-renewable resources. We will seek fairness to continue to make Saskatchewan a better place for families and build a bright future here, for our young people."

The federal equalization formula introduced in the spring budget includes a cap that will claw back Saskatchewan's non-renewable resource revenues.

"Since 1982, significant restrictions to the Equalization program have created confiscatory claw back rates on Saskatchewan energy revenues," Justice Minister Frank Quennell said. "Touted as a ‘fix' for equalization by the federal Conservatives, we contend that the effect of the cap is discriminatory and contrary to the Canadian Constitution and the 1930 Natural Resources Transfer Agreement. The Constitution recognizes the principle of equalization as necessary for the federation. The equalization formula must be fair and equitable and this formula is not."

Saskatchewan has long called for fair treatment of its non-renewable resource revenues, pointing to the fact that other provinces have been able to fully benefit from theirs. Nova Scotia and Newfoundland and Labrador were able to achieve temporary exemptions of their oil and gas revenues from the equalization formula with the Atlantic Accords. Saskatchewan supports the Atlantic Accords and notes that Saskatchewan is currently the only province significantly affected by the cap.

Saskatchewan's decision to pursue a legal challenge comes after many attempts to negotiate a fair deal with previous federal administrations and most recently, with the federal Conservative government.

"The federal Conservative government has dismissed Saskatchewan's substantial, sustained efforts to achieve a negotiated agreement," Government Relations Minister Harry Van Mulligen said. "This despite promises from Prime Minister Harper and 12 Saskatchewan Conservative Members of Parliament, made when the party was in opposition, to exclude non-renewable resource revenues from the equalization formula."

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For more information, contact:

Jay Branch
Executive Council
Regina
Phone: 306-787-6349
Email: jay.branch@gov.sk.ca
Cell: 306-539-3994