A federal Conservative MP who campaigned against Justin Trudeau's pricing plan now says it's the least-bad option for softening the blow to consumer pocketbooks while a litre of unleaded gas hovers around $1.70.

That in turn highlights Progressive Conservative Premier Blaine Higgs's own reversal on his promise from 2018: to ensure the federal scheme had no impact on taxpayers' bottom line.

New Brunswick Southwest  MP John Williamson startled Conservatives and Liberals alike last week when he called on Higgs to immediately scrap his own provincial carbon tax system so that Ottawa would impose its version, which includes rebates.

"The backstop will kick in, the feds will take it over, and as part of that change-up … cheques will begin to roll out to New Brunswick families," Williamson said.

Higgs dismissed that possibility, saying the faster solution is Ottawa suspending the pricing standard it imposes on the provinces. 

That standard requires provinces to charge an 8.8-cent charge on a litre of unleaded gasoline, increasing to 11 cents April 1.

The Trudeau government says that increase will go ahead despite calls for a pause.

Williamson says while his party still wants to "kill the Liberal carbon tax," the federal position leaves Higgs no choice but to let it take effect in New Brunswick so consumers here get rebates.

"This is a good way to help people right away," he said.

Federal Liberal Environment Minister Steven Guilbeault couldn't resist flagging Williamson's comments on social media.

"It's refreshing to see a Conservative MP acknowledge that our price on pollution puts money back in the pockets of middle class families," he tweeted. 

Williamson says if Higgs doesn't act now, he and his government will share the blame for high gas prices.

"They will own part of that tax increase," the MP said.

"Premier Blaine Higgs isn't responsible for the carbon tax or the annual increases but by managing it for the Liberals, he'll be perceived as driving the getaway car."

The Williamson-Higgs exchange is a reminder that the premier has yet to keep his 2018 election campaign promise to completely negate the impact of a federal carbon tax.

Higgs vowed on the campaign trail that "taxpayers of this province will not have increased taxes as a result of the federal government imposing it."

With the premier crafting his own carbon tax model and spending millions of the revenue, "it's not revenue neutral," Williamson said.

Premier Blaine Higgs uses part of New Brunswick's carbon tax revenue to fund climate change projects and to cover the cost of a four-cent reduction to the provincial gas tax and a small income tax cut. (Ed Hunter/CBC)

Acadia University political scientist Erin Crandall says the MP's comments pressuring a politically allied premier are unusual and reflect the policy uncertainty created by high gas prices.

"In the short term nobody is quite sure what the best answer is," she says.

"The question is what is the best response? It's not necessarily the case that there's one clear answer to that." 

Crandall says complicating the picture further is that the carbon pricing mechanisms are complicated for many voters to understand, while the impact of price spikes at the pump are clear and visible.

Under the federal pricing law, Ottawa sets the tax rate, but allows the provinces to run their own systems and decide what to do with the revenue.

In the four provinces that refused to implement their own tax – Alberta, Saskatchewan, Manitoba and Ontario – the federal government implemented its own carbon tax directly and rebates 90 per cent of the money it collects.

But the provinces that set up their own systems are free to keep and spend whatever portion of the revenue they want.

Higgs uses part of it to fund climate change projects and to cover the cost of a four-cent reduction to the provincial gas tax and a small income tax cut.

Williamson says the federal model is better because it would put almost all the money back into the pockets of New Brunswickers.

An independent review by the parliamentary budget officer in Ottawa found that people at the low end of the income scale get more money in rebates than they pay in carbon taxes.

"Right now it's those working Canadians on modest and low incomes that need the help the most and this will deliver assistance right away," Williamson said.

Current rebate levels in provinces that refused to adopt their own carbon taxes range from $600 in Ontario to $1,000 in Saskatchewan for a family of four.

Higgs argued last week that rebates are not an "immediate" solution because they'd require money "going to Ottawa and then coming back, and taking months for that to happen."

An immediate three-month suspension of the federal pricing standard would be faster, he said.

In a statement Monday the premier added that a provincial rebate would require legislation and would take time to set up.

It's not clear how fast federal rebate cheques would arrive if Ottawa's backstop took effect.The Liberals have promised to switch from a once-a-year credit on income tax returns to quarterly cheques.

Last week federal Intergovernmental Affairs Minister Dominic LeBlanc said Higgs has "a whole series of tools" he can use to lower the price at the pump as soon as he chooses.

That includes reducing or eliminating the provincial gas tax.

But Higgs said last week he can't afford to give up the gas tax revenue because it's "built into the expenses that we incur every day in the province."

He hinted the budget on March 22 will include new spending to address "many of the concerns that people are having," resulting in a smaller surplus.

"Every government, as they collect more revenue, tend to spend it," Williamson said.

When Higgs promised in 2018 to ensure New Brunswickers weren't out of pocket because of the federal carbon tax, the assumption was Ottawa would collect the money and transfer it to the provincial government to spend as it saw fit.

After the Trudeau Liberals opted to bypass the province with direct rebates instead, Higgs adopted his own system. 

Williamson says that means the Trudeau system —at least until federal Conservatives get the opportunity to kill it altogether — is the lesser of the two evils.

"Welcome to federal politics," he said. "These are normally the choices we have to make."

The federal government sets the tax rates, so any changes to it require federal approval.

The current carbon tax rate on gas is 8.8 cents per litre. It's scheduled to rise to 11 cents per litre on April 1.

Deferring the carbon tax would bring down prices by 11 cents, Higgs told CBC News. He'll be meeting with his caucus later this week to discuss the deferral. 

Gasoline prices have jumped twice in New Brunswick over the past week, causing some stations to sell fuel for up to $1.82 per litre for regular self-service gasoline and $2.00 per litre for self-service diesel.

Higgs said he'd like to do something to ease prices at the pumps, though he emphasized New Brunswick isn't in the same position as provinces like Alberta, which announced it will pause collection of provincial fuel tax, starting April 1, to help consumers grapple with rising gas prices. 

"They are making this up many times over on the increased price of crude oil and their ability to get revenues there," Higgs said.

He didn't say whether economic chaos over the past few days had otherwise impacted the upcoming provincial budget, set to be brought in on March 22. The provincial surplus of $444 million from the past year also isn't a solution, Higgs said. 

The budget will use revenue streams to address many of the concerns people have about issues like high housing costs and the health-care system, Higgs said.

Jean-Marc Picard, the executive director of the Atlantic Provinces Trucking Association, said it can cost $2,000 to fill up a tractor-trailer truck. (CBC)

Jean-Marc Picard, executive director of the Atlantic Provinces Trucking Association, said the cost of fuel, which jumped twice within five days last week, is a growing concern for his members.

"It's concerning for all types of companies, but for smaller companies I think it's a bit more impactful just because of the way their business is set up," Picard said.

"If you only have a handful of trucks and you put $2,000 of diesel in, and you do your deliveries, you probably won't get paid for 30 or 45 days for those deliveries, so you have to be really financially sound and you have to be solid."

Businesses relying on trucking services could see higher delivery costs in the short term, Picard said, and if the higher gas prices persist, those extra costs could eventually make their way to the end consumer. 

"If it's short-lived we're probably not going to see that, but if it stays that way for a while we're probably going to see some price hikes for sure."

Higgs said a "deferral" of the carbon tax would take 11 cents off the cost of a litre of gasoline.

But it's a change that would require the federal government's approval, since by law it's Ottawa that sets the rate, and that approval isn't coming.

Federal Intergovernmental Affairs Minister Dominic LeBlanc told CBC News the federal carbon pricing standard will stay the same and increase as scheduled at the end of this month.

"We have no intention of changing the planned increase to take effect on April 1," he said. 

He said while Ottawa establishes the rate, the Higgs government designed its provincial systems and has the flexibility to return more of that money to consumers.

"The New Brunswick government has a whole series of tools on its own to decide if it wants to do something about the price at the pump, but the federal carbon price increase will go ahead as planned." 

Trevor Tombe, an economics professor at the University of Calgary, said a carbon tax cut is not the best way to give consumers a break. (Colin Hall/CBC)

University of Calgary economist Trevor Tombe says the province should use other tools because a carbon tax cut is not the best way to give consumers a break.

He said it's better to simply send people cheques, allowing the province to target those who need the help most if it chooses to.

"The increase in the price of gasoline is a strain on some families and not others, and more targeted approaches–to ensure that those who need to support get it–may be much more effective for governments to pursue," he said.

The price of a litre of regular unleaded gasoline was hovering around $1.80 in New Brunswick on Wednesday morning, with much of the recent increase attributed to the invasion of Ukraine by Russia, a major oil exporter now being hit by sanctions.

Higgs told CBC News Tuesday he plans to speak to his fellow premiers Thursday about a deferral of the carbon tax that would save people 11 cents a litre.

The current rate is 8.8 cents a litre but it's due to increase to 11 cents on April 1.

Suspending the provincial gasoline tax, which is 10.9 cents per litre, would produce almost exactly the same savings for drivers at the pumps.

Opposition Liberal Leader Roger Melanson said that's what Higgs should opt for because he can do it "right now" without having to get federal approval.

"The carbon tax is certainly not under New Brunswick's sole control, and it's a lot more complicated to be achieved."

Liberal Leader Roger Melanson said there are other ways than a carbon tax cut to ease pain at the pumps. (Government of New Brunswick)

Melanson said Higgs is focusing on carbon taxes to try to avoid his own responsibility to help New Brunswickers, but "there's other ways, provincially, under the premier's control to be able to ease some of this pain at the pump." 

Prince Edward Island announced Tuesday it will start rebating part of its carbon tax on April 1, and Nova Scotia said this week it will look at reducing the provincial gas tax.

Alberta announced this week it's suspending its provincial gas tax completely and also providing ratepayers in the province a $150 rebate on their electricity bills.

But Higgs points out the spike in oil prices means Alberta is awash in royalty revenue and can afford that move "many times over," while New Brunswick cannot.

"It's a very different situation," he said.

In rejecting a provincial gas tax cut, Higgs also dropped some hints about the upcoming provincial budget on March 22.

He suggested there'll be major spending increases to address "many of the concerns that people are having" in areas such as health care, education, social assistance and "controlling the high cost of rent."

Higgs sees shrinking surplus

The new spending will shrink this year's projected $487.8 million surplus down to a "very slim" $50 million to $100 million, he said, which makes a gas tax cut impossible.

"We're running very, very close to the wire," Higgs said.

"The budget is laid out and obviously the revenue stream that goes directly into that is what supports all those projects, so it's difficult to have one without the other."

Melanson said New Brunswickers can't take the premier's word for that because of two straight years of larger than expected surpluses.

"Who can trust the premier's budget? No one. No one can trust what the premier's going to table on March 22 in terms of numbers."

The gas tax was projected to bring in $202.5 million this year, while the carbon tax was forecast to collect $163 million, with $36 million of the total going to climate change projects.

Last year Higgs used some of the remaining $127 million in carbon tax revenue to pay for a small income tax cut.

Economist favours rebate

Higgs could quickly cut income taxes further as another way to help New Brunswickers cope with rising costs. 

But Tombe said that's not as efficient as a rebate because an income tax cut wouldn't help low-income people already below the threshold for paying income taxes.

"I'm thinking of direct cash transfers, literally writing a cheque."

The rebate could be processed through a tax credit that the province could make available when New Brunswickers file their tax returns this year.

Melanson said another argument against a carbon tax cut is that "climate change isn't going away" and still needs to be addressed.

But Higgs argued Tuesday the Russia spike will achieve the same objective: to give people a financial incentive to change their behaviour and lower their consumption of fossil fuels.

The carbon tax "was there to offset consumption with higher prices," he said. "Well, we're certainly seeing that right now."

But Tombe said a sudden spike in gas prices caused by world events doesn't alter consumer behaviour the same way a carbon tax does.

Research shows that consumers change their behaviour in response to a carbon tax because it's a long-term measure that increases slowly, over time, and serves as a reminder about climate change, he said.

Temporarily reducing it because of the Russia spike may not lead to the same results.

"At some point there's going to be a reduction in the world price of oil," he said. "It goes up and down and we're used to that, so we respond to temporary spikes differently that permanent changes."

A one-time rebate "is better in that it's not affecting the operation of gasoline markets. It's not affecting market prices. It's supporting families without changing prices." 

LeBlanc said business groups have told the federal government they prefer a stable, predictable carbon price because it allows them to do better long-term planning for reducing emissions.

The latest resetting by the EUB is based on tumultuous New York spot-market trading that occurred over the last week as of the end of business Tuesday.

But they are already stale given dramatic price reversals in those same trading markets on Wednesday.

According to an account by Reuters, the ambassador to the United States from the United Arab Emirates, Yousef Al Otaiba, said in an embassy tweet early Wednesday his country was pushing OPEC, the Organization of Petroleum Exporting Countries, to increase oil production to make up for Russian exports that are now subject to widespread international sanctions.

"We favour production increases and will be encouraging OPEC to consider higher production levels," said the statement in the tweet sent by the UAE embassy in Washington.

The statement triggered an instant and dramatic decline in international oil prices and in North American spot markets for refined products including gasoline, diesel and heating oil.  

By the end of Wednesday the trading price of gasoline was down approximately 13 cents per litre. But the real collapse was in diesel, which fell up to 46 cents per litre and settled below where it had been before the Russia invasion began.

New Brunswick pricing rules require any market changes in gasoline or diesel of six cents per litre or more in a single day to be passed on to consumers within 32 hours of the close of trading.

That will force the Energy and Utilities Board to cut maximum prices at midnight.  

Including the HST, that means a likely 15-cent reduction in maximum gasoline prices and up to 52 cents cut from the price of diesel in New Brunswick by Friday morning..

However, late Wednesday, according to the BBC, UAE's energy minister, in a tweet of his own, appeared to contradict the earlier statement from its embassy and that has markets surging higher again Thursday.

If trading prices for petroleum products end Thursday more than six cents higher, it would not change a reduction for Friday. Under New Brunswick regulations it will be added into prices on Saturday.

- Bob Cormier, manager Fairview Lanes

"My staff and myself, we're going to continue wearing our mask, type of thing, you know, just be on the safe side, type of thing. And, you know, we'll see how this plays out, type of thing," he said.

"I just hope that by changing everything, it's not going to affect us that we end up getting shut down again, type of thing, because we've been shut down so much and we're trying to get some of our business back. But you know, people are scared and that type of thing. So, you know, I have mixed reactions to all this, type of thing, that's for sure."

Cormier expects staff will continue to wear masks for at least another month.

He'll also post a sign to recommend patrons wear a mask, even though they're not required.

"I've been talking to some of my customers over the last couple of weeks about all this. And you know, they're saying the same thing, 'We're going to, you know, depending on where we are, we're going to continue to wear a mask.'"

Cormier says business has been slow — about half than usual, or even less, at times during the pandemic. But it's starting to rebound.

Fairview was busy last week, with the Family Day holiday, he said. And he's hoping for another good week next week, with March break.

Breakdown of hospitalizations and cases

Of the 89 people in hospital Monday, 47 are hospitalized for COVID-19 and 42 were admitted for something else when they tested positive for the virus.

Two people 19 or under are in hospital, along with one person in their 20s, three in their 30s, and six in their 40s, while the other 74 are aged 50 or older.

The three people in intensive care include one in their 30s, one in their 40s and one in their 60s.

The seven-day average of COVID-related hospitalizations, which has been on a steady decline for the past three weeks, when it stood at 161 on Feb. 7, took a slight uptick Monday to 76, from 75 on Friday, when the province last released figures.

The seven-day average of people requiring intensive care, however, decreased to five from six.

There are 443 health-care workers isolating because of COVID-19, an increase of 23 since Friday. These include 234 with Horizon Health Network, 140 with Vitalité Health Network, and 69 with Extra-Mural and Ambulance New Brunswick.

The province's hospitals are operating at 90 per cent capacity and intensive care units are at 72 per cent capacity, according to the dashboard.

New Brunswick reported three new deaths after the weekend. (CBC News)

Public Health confirmed 1,065 new cases of COVID-19 through lab-based PCR tests between Saturday and Monday, putting the active case count at 3,542.

An additional 1,382 people self-reported testing positive on rapid tests.

The regional breakdown of PCR-confirmed cases includes:

Moncton region, Zone 1

• 437 new cases and 1,319 active cases

Saint John region, Zone 2

• 230 new cases and 727 active cases

Fredericton region, Zone 3

• 234 new cases and 758 active cases

Edmundston region, Zone 4

• 38 new cases and 210 active cases

Campbellton region, Zone 5

• 29 new cases and 111 active cases

Bathurst region, Zone 6

• 68 new cases and 273 active cases

Miramichi region, Zone 7

• 29 new cases and 144 active cases

A total of 731,429 PCR tests have been conducted to date.

A total of 49.9 per cent of eligible New Brunswickers have received their COVID-19 vaccine booster dose, up from 49.7 per cent on Friday, 87 per cent have received two vaccine doses, up from 86.9 per cent, and 92.8 per cent have received one dose, unchanged.

New Brunswick has had 37,482 cases of COVID-19 since the beginning of the pandemic, with 33,634 recoveries so far and 304 COVID-related deaths.

A high number of cases still has an impact on attendance and teacher availability.

Last week, the New Brunswick Teachers' Association said supply teachers can't fill the demand left by self-isolating staff.

Cardy said the province will continue to work on finding a solution to the supply-teacher shortage. He said the department has a list of non-teacher staff with classroom experience who are ready to fill in on short notice.

"We have had some schools that have had real issues on for a couple of days, but those gaps have generally have been quickly filled," he said.

"In a couple of cases, we had schools where I don't think they were aware that they had those resources available, so [we're] making sure those communications were open."

Department of Education spokesperson Flavio Nienow confirmed Monday teachers and students won't have to self-isolate if they get sick with COVID-19 after March 14.

Dominic Cardy has been using Twitter to call for a bold response to Russia's invasion of Ukraine, including by retweeting calls for Western countries to send more arms and use air power to create a "no-fly zone" over the country.

On Friday Green MLA Kevin Arseneau challenged Cardy to "walk the walk" by ensuring that New Brunswick's corporate registry is made more transparent.

"Here is some stuff you could actually act on right now, being in cabinet and whatnot, that have been continually pushed under the rug by your government," Arseneau said on Twitter.

"Let's shut down the NB loopholes right here at home, right now!"

Arseneau linked to a New York Times opinion column arguing for a crackdown on Russian oligarchs who hide their wealth in banks in Western countries. 

He also linked to a CBC News report from 2020 showing that New Brunswick has lax corporate rules that make it difficult to tell who really owns and controls corporate entities.

That investigation traced connections between an Alberta-registered company that operated a vessel insured in Russia and fishing off the coast of Mauritania. 

The Alberta-registered company and another company registered in New Brunswick had both received large sums of money via the Russian banking system, according to records shared with the International Consortium of Investigative Journalists by Buzzfeed News as part of the FinCEN Files investigation.

The Higgs government promised in December 2020 to require companies registered in their province to maintain a list of people with ownership control and make it available to police and governments. 

But that change still hasn't happened 15 months later.

Getting that done "could be a good way of walking the walk," Arseneau suggested to Cardy on Twitter.

Over Twitter, Green Party MLA Kevin Arseneau said Dominic Cardy should "walk the walk" on Russia by making it harder to hide money-laundering efforts in the province. (Jacques Poitras/CBC News)

Cardy responded: "If there are NB specific loopholes let's talk about them. Here or offline!"

The minister told CBC's Information Morning Fredericton on Monday that the government is "absolutely" looking at those measures and others.

"We're looking to try and see: are there any areas within government operations where there are loopholes, openness, any possibilities of Russia using New Brunswick in any way to evade the full blockade of their economy?" 

Cardy said he spoke to Arseneau and Liberal education critic Benoît Bourque on Friday about other possible steps. 

Service New Brunswick said late on Friday that amendments to the Business Corporations Act are expected to be introduced in the legislature this spring.

 After his exchange with Arseneau on Friday, Cardy tweeted that he was making a donation directly to Ukraine's military and added a link for donations to the United Nations' humanitarian aid program for the country.

The minister has been using his Twitter account to criticize what he considers a too-tepid Western response to the Russian attack on Ukraine.

In one tweet he predicted the West will eventually "be at war with, or be defeated by" Russia and China.

"The sooner we talk about this, how to plan for it, what it means, and why it's important that we win, the better," Cardy wrote.

"That means reforms at home, not just war abroad. But it means war."

Cardy has been criticized by some Twitter users for tweeting more about Ukraine than about his responsibilities as minister of education and early childhood development.

He responded that it's his personal account and while he uses it to answer questions about his "day job," he'll block anyone who complains about him talking about other subjects. 

Arseneau says rather than retweeting calls for military intervention in Ukraine, Cardy should use his position to support actions he can influence, such as the corporate registry change.

"We still have one of the more opaque corporate registries in Canada, and Canada is already not very high up there in transparency," he said.

Service New Brunswick Minister Mary Wilson said in the legislature in December, 2020 that the new beneficial ownership requirements "will increase ownership transparency and assist in exposing activities such as money laundering and tax evasion."

On Friday, N.B. Liquor said it was "voluntarily removing" Russian products from its shelves.