N.L. 'shafted' in federal budget: Williams

Newfoundland and Labrador Premier Danny Williams said the federal budget released Monday is a betrayal of his province, and he wants voters to punish the Conservatives in the next federal election.

"What they've done today is basically and completely shafted us," Williams told reporters after the budget was released. "It's scandalous what they've done, when you think of it."

The budget includes more money for the provinces and a new formula for equalization payments, but each province has to choose between the current system and the new one.

Newfoundland and Labrador and Nova Scotia are likely to opt for their current arrangement under the Atlantic Accord, which, by allowing them to keep their offshore oil revenues, is better than the enriched new system, at least for now.

The new system itself offers two options: a province can choose to have its equalization payments calculated by including half of its resources revenue or by excluding all of it. But the rules also impose a cap on the amount any province can receive.

Prime Minister Stephen Harper wrote a letter to Williams in January 2006 vowing tokeep non-renewable energy resources out of the equalization formula.

"The Conservative government will ensure that no province is adversely affected from changes to the equalization formula," Harper wrote at the time.

Williams is now vexed with Harper and said he has broken a promise for a better equalization deal.

"We had a very, very strong commitment a commitment in writing. And as I say it's been completely reneged on. It's been completely negated," Williams said.

"What I'm saying is to the people of this province, based on the fact that they've broken their promise and broken their commitment, [you]should not vote Conservative in the next federal election," Williams said.

No support for Labrador airbase

Meanwhile, residents in Labrador have another point of contention with the Conservative budget.

People in Happy Valley-Goose Bay say Monday's budget did nothing to clear up the future of 5 Wing Goose Bay, the Canadian Forces airbase there.The Conservatives had promised to station about 700 Canadian troops in Labrador, but there was no mention of that in the budget.

The base has seen little activity since a number of NATO countries stopped low-level flight training in Labrador.

The Goose Bay Citizens Coalition had hoped the budget would include the release of Ottawa's new "Canada First" defence strategy, a Conservative plan that is expected to outline the future of the airbase, but that didn't happen.