Haliguy
10-11-2007, 12:42 AM
Stephen Harper has moved to shore up his weak Atlantic flank, agreeing to a new resource revenue deal with Nova Scotia that ends a politically damaging dispute amid talk of a fall election.
But while the deal brought soothing words from one eastern premier, it got only scorn from another.
The prime minister and Nova Scotia Premier Rodney MacDonald held a surprise news conference in Ottawa on Wednesday to announce the agreement.
It provides Nova Scotia with a legislated guarantee that it will not lose any royalties under changes made to its cherished offshore accord in last spring's federal budget.
The budget forced the province and Newfoundland to choose between their Atlantic accords and a new equalization formula - a decision that had the potential of costing Nova Scotia up to $1 billion.
Harper hailed the deal as a "historic breakthrough" while acknowledging the complexity of a dispute that has raged on and off for 20 years.
"These are not easy issues," he said. "The the Atlantic accords are highly technical arrangements over which people of good faith can have differing interpretations."
Harper is hoping the new peace will mean a boost for his electoral fortunes in Nova Scotia, but the battle rages on with Newfoundland.
Newfoundland Premier Danny Williams, who launched a fierce attack on Harper after the budget, slammed the deal.
"Steve is going to rain on my parade, I guess," Williams quipped, referring to the fact that the announcement came a day after he won a massive election victory.
"There's a bit of politics going on. . . The bottom line here is that Nova Scotians have said Yes to less.
"Stephen Harper has a way for preying on the weak. . . He sees in Nova Scotia - a minority government that is in difficulty - and he's talked them into taking this. It's not something I'm prepared to take."
MacDonald insisted it's a good deal for his province.
"I've always told Nova Scotians we will not lose one red cent from the accord," he said. "Our two governments are reaffirming that today."
However, the province's Liberal leader, Stephen McNeil, called it "a sad day for Nova Scotia."
He said numbers produced by the provincial government show that the province will likely make less money under the new deal, when compared with the 2005 Atlantic Accord, until 2019.
Ottawa and Nova Scotia also agreed to settle a long-standing dispute over the offshore as it relates to what's called a Crown share. A three-person panel will be set up to study the value of the complex cash royalty, which was part of the province's original 1985 offshore agreement.
The crown share was a common feature of resource agreements in the early 1980s under the now-defunct National Energy Program. Since production started in the Nova Scotia's first offshore oil project in the early 1990s, Ottawa has not paid the benefit to the province.
Federal officials have long argued they don't have to pay it because of a loophole prevented them enacting regulations on behalf of Nova Scotia.
MacDonald estimated payment of the Crown share could be worth "hundreds of millions of dollars" to the have-not province.
The panel is expected to report with a binding decision by the end the year, and it could eventually mean a large cash payment to the province similar to the one it received from the former Liberal government of Paul Martin.
Both Nova Scotia and Newfoundland have fought long battles with successive federal governments to limit a clawback of their offshore petroleum royalties. Under the old system, both provinces lost 70 cents in equalization payments for every dollar they earned in oil and natural gas royalties.
Former Nova Scotia premier John Hamm and the current premier of Newfoundland, Danny Williams, struck an agreement with Martin that allowed them to hold on to the revenue without penalty. But last spring's budget largely unravelled the deal struck with the Liberals.
That prompted both Newfoundland and Nova Scotia to complain that they were being short-changed by the federal government.
The dispute has been political poison for Harper in Nova Scotia, enraging the public and dividing Conservatives.
But while the deal brought soothing words from one eastern premier, it got only scorn from another.
The prime minister and Nova Scotia Premier Rodney MacDonald held a surprise news conference in Ottawa on Wednesday to announce the agreement.
It provides Nova Scotia with a legislated guarantee that it will not lose any royalties under changes made to its cherished offshore accord in last spring's federal budget.
The budget forced the province and Newfoundland to choose between their Atlantic accords and a new equalization formula - a decision that had the potential of costing Nova Scotia up to $1 billion.
Harper hailed the deal as a "historic breakthrough" while acknowledging the complexity of a dispute that has raged on and off for 20 years.
"These are not easy issues," he said. "The the Atlantic accords are highly technical arrangements over which people of good faith can have differing interpretations."
Harper is hoping the new peace will mean a boost for his electoral fortunes in Nova Scotia, but the battle rages on with Newfoundland.
Newfoundland Premier Danny Williams, who launched a fierce attack on Harper after the budget, slammed the deal.
"Steve is going to rain on my parade, I guess," Williams quipped, referring to the fact that the announcement came a day after he won a massive election victory.
"There's a bit of politics going on. . . The bottom line here is that Nova Scotians have said Yes to less.
"Stephen Harper has a way for preying on the weak. . . He sees in Nova Scotia - a minority government that is in difficulty - and he's talked them into taking this. It's not something I'm prepared to take."
MacDonald insisted it's a good deal for his province.
"I've always told Nova Scotians we will not lose one red cent from the accord," he said. "Our two governments are reaffirming that today."
However, the province's Liberal leader, Stephen McNeil, called it "a sad day for Nova Scotia."
He said numbers produced by the provincial government show that the province will likely make less money under the new deal, when compared with the 2005 Atlantic Accord, until 2019.
Ottawa and Nova Scotia also agreed to settle a long-standing dispute over the offshore as it relates to what's called a Crown share. A three-person panel will be set up to study the value of the complex cash royalty, which was part of the province's original 1985 offshore agreement.
The crown share was a common feature of resource agreements in the early 1980s under the now-defunct National Energy Program. Since production started in the Nova Scotia's first offshore oil project in the early 1990s, Ottawa has not paid the benefit to the province.
Federal officials have long argued they don't have to pay it because of a loophole prevented them enacting regulations on behalf of Nova Scotia.
MacDonald estimated payment of the Crown share could be worth "hundreds of millions of dollars" to the have-not province.
The panel is expected to report with a binding decision by the end the year, and it could eventually mean a large cash payment to the province similar to the one it received from the former Liberal government of Paul Martin.
Both Nova Scotia and Newfoundland have fought long battles with successive federal governments to limit a clawback of their offshore petroleum royalties. Under the old system, both provinces lost 70 cents in equalization payments for every dollar they earned in oil and natural gas royalties.
Former Nova Scotia premier John Hamm and the current premier of Newfoundland, Danny Williams, struck an agreement with Martin that allowed them to hold on to the revenue without penalty. But last spring's budget largely unravelled the deal struck with the Liberals.
That prompted both Newfoundland and Nova Scotia to complain that they were being short-changed by the federal government.
The dispute has been political poison for Harper in Nova Scotia, enraging the public and dividing Conservatives.
