Feds mull pulling $67M from Manitoba: sources By: Dylan Robertson Posted: 7:00 PM CDT Thursday, Oct. 25, 2018

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This article was published 25/10/2018 (2290 days ago), so information in it may no longer be current.

OTTAWA — The federal government might pull the rug out from under Manitoba by withholding the $67 million it promised for carbon retrofits, the Free Press has learned.

Multiple sources said Environment Minister Catherine McKenna’s staff may review whether Manitoba will get its share of the Low Carbon Economy Fund, after weeks of insisting the province would get its share.

McKenna would not dismiss those claims on Thursday when she was asked to confirm whether she’d ordered a review of Manitoba’s funding.

“We’re committed to working with Manitobans, businesses, schools, cities, hospitals, to tackle climate change and support more energy efficient projects,” she told the Free Press.

Premier Brian Pallister’s office said he would feel betrayed if Manitoba doesn’t receive that cash, which officials are in the course of planning to give to various groups.

“We are not aware of any conversations regarding the federal government reconsidering our (LCEF) participation,” wrote a spokesman.

“We would regard withdrawal of Manitoba’s LCEF allocation as an act of bad faith against Manitobans.”

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In February, the Pallister government ended a 14-month standoff with Ottawa over the fund, which provides cash for carbon-reducing projects. Manitoba had demanded clarity that collecting its $67 million share wasn’t contingent on raising its carbon tax.

To access its cash, the province had to endorse the Pan-Canadian Framework on climate change (PCF), a document that outlines principles such as the need for carbon pricing — but doesn’t prescribe the carbon-tax benchmarks.

In June, when Doug Ford was elected Ontario premier and his government scrapped virtually all environmental policies, McKenna put Ontario’s share of the fund under review.

At that time, her office assured the Free Press that Manitoba’s funding was not in jeopardy, in spite of a flat-tax carbon levy that would eventually fall short of federal benchmarks.

McKenna’s spokeswoman said she was reviewing Ontario’s cash because that province reneged on the PCF — whereas Manitoba had “shown real leadership” in “commitments to cleaner fuels, more sustainable agriculture (and) support for energy efficiency,” Caroline Thériault wrote on Aug. 30.

This month, Pallister scrapped his flat-tax plan and dared the federal Liberals to impose their tax. A day later, Thériault said the LCEF cash was safe. “No, it is not currently under review,” she wrote on Oct. 4.

Senior sources say McKenna changed course during the past three weeks, and is considering a review.

On Thursday, Thériault confirmed that Ottawa had still had not signed a contribution agreement with Manitoba — eight months after the province ratified the PCF.

Ottawa signed such an agreement with New Brunswick last December, four months after it endorsed the PCF. This week, McKenna unveiled her plans to impose the federal carbon tax on both provinces, raising questions as to why Ottawa is singling out Manitoba.

The Liberals have put immense political capital in getting Manitoba its LCEF money. Last December, the party had St. Boniface MP Dan Vandal raise concerns about Manitoba losing that funding. In the same month, the Free Press revealed that McKenna had sent a letter to the Manitoba government in which she said the Tories had to endorse the PCF by the end of February to secure the $67 million.

At the time, Manitoba lambasted McKenna’s choice to “play games with intergovernmental correspondence.”

Manitoba Tory MP Robert Sopuck, a former marine biologist who has studied both governments’ plans, said he’s worried that “slippery Liberals” will end the funding, and thus undermine Pallister’s ability to implement parts of his green plan.

“It was an act of courage in the face of serious budgetary considerations,” Sopuck said of the Pallister plan.

The MP said it would be “tragic” if Ottawa retaliated against Pallister for scrapping his government’s plan and accusing the Liberals of using him as “a prop” to berate Tory premiers who shunned carbon taxes.

“My guess is they want to be vindictive about this,” Sopuck said.

dylan.robertson@freepress.mb.ca