OPINION: PQ struggles to assert Quebec’s sovereignty financially

The Parti Québécois has always faced the difficult task of convincing voters that Quebec is financially better off as an independent country than as a province of Canada. As much as Quebec has relied heavily on federal equalization payments, the basic accounts suggest just the opposite.

This year, the province will receive $13.9 billion in equalization funding from Ottawa. That amount is projected to increase to $15.2 billion by 2030.

But despite billions of dollars in equalization payments aimed at helping poorer provinces provide the same public services at the same tax levels as richer provinces, the Quebec government is projecting an $8.6 billion deficit this year. Without equalization transfers, the shortfall would be significantly larger.

Quebecers fund the federal equalization program, at least in part, through taxes they send to Ottawa. As an independent country, Quebec would have the upper hand by reclaiming these taxes and eliminating bureaucratic duplication, the PQ argued.

There are signs of weakness in the Parti Quebecois, and the opposition is circling.

But it takes a lot of faith to believe in Pekiste’s mathematics. Because equalization isn’t the only federal program that favors Quebec.

The federal government spent about $27 billion more in taxes than it collected in Quebec in 2024, according to Statistics Canada. Federal spending exceeded Quebec’s federal revenues by 32 percent. This would mean a tremendous financial hole that an independent Quebec would need to fill.

When La Presse journalist Francis Vaille pointed this out in a column last week, PQ leader Paul St-Pierre Plamondon’s first reaction was to shoot the messenger.

Under its previous owners, the influential Desmarais family, La Presse editorials strongly supported federalism in the 1980 and 1995 referendums. However, the all-digital newspaper is now a nonprofit organization, and its journalistic standards are among the highest of any media outlet in the state.

Nevertheless, Mr. Saint-Pierre Plamondon accused Mr. Bayeux and other opinion columnists at La Presse of “inciting disinformation” and “conducting federalist propaganda on the question of Quebec independence.” He denied there is a $27 billion gap between Quebec’s federal spending and taxes, arguing that “the vast majority of this money never reaches Quebec” and that it involves “bureaucratic costs, paperwork that occurs in Ottawa and stays in Ottawa.”

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As for the rebuttal, it was thin porridge. PQ leaders will have to work harder if they want to win the support of Quebecers who remain skeptical of sovereignty.

The methodology StatsCan uses to allocate federal spending to states is incomplete. Additionally, this data does not reflect the indirect costs and benefits of each state’s federal spending and tax policies.

But StatsCan’s statistics show the flow of money between Ottawa and the province as accurately as you can find anywhere else.

Nicolas Marceau, a professor of economics at the University of Quebec in Montreal and a former PQ finance minister, offered a more subtle criticism of La Presse’s article, noting that federal spending is increasingly financed by debt. One-fifth of Ottawa’s growing debt burden, projected to exceed $1.4 trillion this year, will inevitably fall on the shoulders of Quebec taxpayers. There is no free lunch.

“An independent Quebec could choose to borrow money to increase its spending, but that is not evidence of prosperity,” Marceau opined. “The real question isn’t, ‘How much will Ottawa spend in Quebec?’ It’s, ‘Who’s going to pay the bill?’ That’s right.”

Still, the debate over the financial sustainability of an independent Quebec is not an argument in favor of the PQ, which has vowed to hold another sovereignty referendum if it wins October’s provincial election. Quebecers have always been wary of the economic risks of sovereignty. That is a big reason why the majority still say they will vote no in a future referendum if that happens.

It remains uncertain whether the PQ will win the next election, much less whether it will win a mandate to hold a referendum. The Quebec Liberal Party (QLP) is making a comeback under new leader Charles Milliard, and opinion polls are pointing to an increasingly close election race. The QLP has historically been the default choice of Francophone federalists, losing ground to the Coalition Avenir Québec in 2018, but appears to be regaining that position as support for the CAQ wanes.

A Leger poll released last week showed the PQ and QLP were tied, with 33% of voters supporting each. The QLP, which fell to 20% in December as then-leader Pablo Rodríguez faced questions over how he would finance his 2025 leadership campaign, now appears to be benefiting from Myriad in power and voters shunning another referendum.

For Saint-Pierre Plamondon, asserting sovereignty economically could not be easier. He’s going to need a much sharper pencil than the one he’s been using.