Four years from now, Churchill Falls (Labrador) Corporation and Hydro-Quebec will automatically renew the 1969 power contract for another 25 years.
Everyone knows that, surely.
What you may not recall, though, is that 2016 is the year that the federal government will renew its annual payment of $8.0 million to the Government of Newfoundland and Labrador under Term 29 of the Terms of Union.
In 1996, the provincial government negotiated an advance on the Term 29 payments totalling $130 million. Here’s the quote from the 1996 budget speech:
We will receive $50 million of the advance this year. The federal government has agreed to provide us with another $80 million over the three year period.
Of course, while people call them Term 29 payments, they are actually the amount set by the commission appointed under Term 29 to study the financial position of the Newfoundland and Labrador government within the first decade after Confederation.
The commission was to recommend “the form and scale of additional financial assistance, if any, that may be required by the Government of the Province of Newfoundland and Labrador to enable it to continue public services at the levels and standards reached subsequent to the date of Union, without resorting to taxation more burdensome, having regard to capacity to pay, than that obtaining generally in the region comprising the Maritime Provinces of Nova Scotia, New Brunswick, and Prince Edward Island.”
The legislative authority for the payment comes from the Newfoundland Additional Financial Assistance Act.
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