Accords and Discord: the Politics of Asymmetrical Federalism and Intergovernmental Relations

ACCORDS AND DISCORD: certain degree of asymmetry in policy is natural THE POLITICS OF ASYMMETRICAL in any federation despite national goals or FEDERALISM AND objectives since implementation and INTERGOVERNMENTAL interpretation will depend on these differences. RELATIONS However, in its most recent (and reincarnated) usage, asymmetrical federalism is a convenient

1 label for the different treatment of constituent By Kathy L. Brock units within a federation. In its silliest and most

complex forms, asymmetrical federalism is Canadian first ministers set intergovernmental qualified as symmetrical asymmetry in the relations on a new trajectory with the signing of federation and contrasted with asymmetrical two accords in 2004. The September health care symmetry. The former refers to the same accord was heralded as a significant achievement opportunity for special treatment being available that would set the parameters of better healthcare for each unit while the latter means different for the next decade. Surprisingly, all of the treatment accorded to essentially similar units.2 provincial premiers signed onto this deal that Although these terms have been bantered about, signaled more intergovernmental cooperation in an they are too cute and confusing to advance the area of primarily provincial jurisdiction. In debate and will not be used here. Instead, contrast, the October Equalization agreement was asymmetrical federalism will be used to discuss controversial even at signing, with one provincial the different treatment of particular provinces premier storming out of the meetings and refusing within the Canadian federation to offset their to sign and other premiers questioning the fairness disabling differences or to enhance their natural of the deal for the “have not” provinces. Different assets. in content and temper of the process, the two deals were similar in initiating a new period of The two deals served as contrasts in the asymmetrical federalism; one as part of its terms implementation of asymmetrical federalism. The and the other as a part of its aftermath. Health Accord was announced in the form of “A

10-year plan to strengthen health care.” In the Asymmetrical federalism is a simple agreement, which contained a substantial rise in concept but sometimes rendered unnecessarily federal funding, the governments committed to a complex. In its most basic form, it may be set of general principles and objectives and understood as differences among the states or specific guidelines that will lead to timely access provinces within a federal system. These to quality health care.3 However, two separate differences may arise from geography, history, communiqués were attached to the agreement. demographics, economic and fiscal realities, “Recognizing that an asymmetrical federalism population characteristics, culture or other key allows for the existence of specific agreements characteristics specific to particular units. A for any province,” the first ministers agreed to a separate deal between the Quebec and federal 1 governments that would allow that province Kathy L. Brock is an associate professor in the School of Policy Studies and Department of Political some flexibility in interpreting and Studies, Queen’s University, Kingston, Ontario. This implementing the agreement, including different 4 paper is based on my notes prepared for a workshop reporting arrangements. While Quebec jointly sponsored by the Institute of Intergovernmental Relations and Royal Society of Canada held at Queen’s University 12 May 2005 2 At a recent conference, academics and practitioners where Douglas Brown posed the three organizing bandied about the phrases essentially derailing the questions of the paper. A slightly modified version of debate from the track of meaningful discussion. the paper was presented at the annual meetings of the 3 Office of the Prime Minister, “A 10-year plan to Canadian Political Science Association, London, strengthen health care,” Ottawa, September 16, 2004. Ontario, June 2-5, 2005. Thank you to Geoffrey Available online at Martin, Bob Young, Geoffrey Hale, and Harvey http://pm.gc.ca/eng/news.asp?category+1&id+260. Lazar for their helpful comments. 4 Ibid.

Working Paper 2005(8) © IIGR, Queen’s University Kathy Brock, Accords and Discord: The Politics of Asymmetrical Federalism and Intergovernmental Relations

committed to the overall objectives and general raised by the October agreement.6 The federal principles of the health accord and especially the government entered parallel discussions with principles of a public health system and to Nova Scotia and more recently has engaged with cooperating with the other governments on Saskatchewan on a new financial deal. It also developing indicators of progress and sharing increased its financial support to Ontario over best practices and information, it specified that it five years by $5.75 billion to offset its maintained control over planning, organizing arguments that it contributes $23 billion more to and managing its health care services. The confederation than it receives.7 Other provinces communiqué also contained an explicit non- are lining up. Asymmetry has come in the derogation clause protecting Quebec’s aftermath to the agreement to buy peace in the jurisdiction.5 The second communiqué nation. committed the governments to working together to improve Aboriginal health. Significantly, the Why are we entering this period of Health Accord recognized the specificity of both asymmetrical federalism and is it beneficial for Quebec and Aboriginal Peoples within Canada. both the constituent units and the federation as a whole? This work traces the roots of the current By contrast, the agreement on equalization resurgence of asymmetrical federalism and and territorial funding did not contain side deals examines some of the means of implementing at the time of signing. The Prime Minster and these differences in treatment before assessing nine premiers established the main features of a the merits of asymmetrical federalism. I argue new equalization and territorial funding that asymmetrical federalism is the result of a framework for the next five years including confluence of key factors within the country and increased federal monies in the 2004-5 year, especially the federal government’s need to more stable future funding, and the creation of justify itself to Canadians. While some degree of an independent panel to review the equalization asymmetry is necessary and even desirable, it program. The payments are designed to offset must be implemented carefully or risks revenue differences in the provinces and becoming the very straightjacket the provinces territories and help them provide essential public are attempting to avoid. The healthy future of services to Canadians on a roughly comparable the nation does not rest on multiplying the basis. Although the resulting treatment is degrees of asymmetry but instead on reflecting different according to provincial or territorial on the root cause of the sense of need for status and to level of fiscal disparity (some asymmetry and recasting the role of the federal provinces are recipients, some are not), the government in light of those reflections. While formula applies to all equally and is, in that way, asymmetry might be sold to the public as a symmetrical. convenient political tool for national unity, in its current application it is undermining the very The asymmetry that has resulted from the sense of comity and reciprocal goodwill needed equalization agreement is subsequent to the to sustain the union in the longer term. For signing and found in a succession of separate but guidance on how best to accommodate related deals. Almost three months to the day differences within our federation and to ensure after the equalization agreement was signed, the Prime Minister announced an agreement in 6 Office of the Prime Minister, “Government of principle with the government of Newfoundland Canada Reaches Offshore Agreement with and Labrador on offshore resource revenues. Newfoundland and Labrador,” Ottawa: January 28, The deal was intended to “address the province’s 2005. Available online at concerns about offshore resource revenues http://pm.gc.ca/eng/news.asp?id=403. 7 triggering reductions in Equalization payments,” Office of the Prime Minister, “Canada-Ontario Agreements: Backgrounder,” May 7, 2005. Available online at http://pm.gc.ca/eng/news.asp?id=482. See 5 “Asymmetrical Federalism that Respects Quebec’s also Premier Dalton McGuinty, “We’re for Jurisdiction,” available online at Equalization –but it’s costing us our ability to keep http://pm.gc.ca/eng/news.asp?category+1&id+260. contributing,” Globe and Mail, March 16, 2005, A17.

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its survival, we should heed the wisdom of the policies corresponded to a new and growing original founders. But first, we look to causes of sense of social justice fed by the Camelot to the the perceived need for this less than innocuous south: the federal slogan of “A Just Society” placebo for the nation’s differences. captured the themes of these programs.8 The federal and provincial governments engaged in a Locating the Recent Root Causes of the Need still relatively harmonious endeavour to expand for Asymmetry: or the federal government’s the welfare state and state activities for the search for identity betterment of Canadians. Citizens still looked to The current trend towards asymmetrical the federal government as a benevolent federalism lies within successive attempts by the authority, proud of Canada’s role and federal government to meet the changing shifts recognition as a peacekeeper internationally and in society and its expectations of government. comforted by the federal government’s measures Following the Second World War, the for peace and order at home as pockets of legitimacy of the federal government was at an insurgence arose. apex. Canadians had fought for the country and while conscription had proven contentious, by The 1970s witnessed the loss of this and large the federal government was seen to innocence and trust in government. Watergate in have served the interests of the nation well. Most the US, the promulgation of the War Measures citizens yearned for peace and prosperity and Act in Canada, growing awareness and rejection looked to the federal government for a new of discriminatory policies all contributed to a sense of security: witness the transfer of all or creeping sense of citizen disillusionment that some responsibility for unemployment insurance was only heightened as economic growth slowed and pensions to the federal government, federal- and spurted, resources became increasingly provincial cooperation in designing economic constrained, and federal-provincial bickering policies that would spur the growth of corporate over responsibilities and money increased. and branch plant (but prosperous) Canada, Citizens began to question the image of federal-provincial agreements on a more government as a vehicle of social justice and progressive tax system and tax-sharing assert their rights in opposition to the state. arrangements, the emphasis on federal defence and aeronautics spending, the attachment to Federal policies and intergovernmental federal policies establishing Canada as a police relations followed this shift from social justice to and then peace force in the world, and so on. a rights-conscious society that was skeptical of political authority by the 1980s. Both to justify By the 1960s, cracks in this contentment its role as a national government in the face of were beginning to show. Canadians, like most the nationalist challenge emanating from Quebec citizens in western democracies, were beginning and as a legitimate representative of democratic to question the existence of elements of values in the face of challenges from citizen imperialism and illegitimate authority within groups, the federal government pressed for the their borders, and no longer just in the adoption of the Canadian Charter of Rights and developing world. The civil rights movements in Freedoms inadvertently entrenching both this the United States, brought into people’s living new sense of entitlement and opposition with the rooms with the advent of television, and state in the citizen psyche and this tension with worldwide struggles against totalitarianism Quebec for the foreseeable future.9 prompted Canadians to question the role of their political leadership. Underlying this challenge to 8 authority, though, was a certain innocence and See for example the thinking underlying policies faith in western liberal democracies and its beginning in the 1960s in Thomas S. Axworthy and structures. Pierre E. Trudeau (eds.), Towards a Just Society: The Trudeau Years (Markham ON: Viking, 1990). 9 Alan Cairns studies the shift to a rights-based In this period of affluence and turmoil, the culture and the effect of entrenching a Charter on the Canadian government responded. Canadian Canadian political psyche in a series of essays. See

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The consequent skepticism of citizens and federal government for cuts in transfers challenge to the legitimacy of the state encouraged a more negative view of the federal contributed to recent federal governments’ government, reaching new heights with its attempts to justify its role within the federation unilateral change to Canada Assistance Plan and often at the expense of intergovernmental introduction of the Canada Health and Social harmony. Faced with dwindling sources of new Transfer (combining monies for health, post- revenues, growing expectations for public secondary education and social programs) in services and mounting public debts and deficits, 1996. The credibility of the federal government the federal government shifted towards a more was further questioned as its ability to set and explicit rights agenda. Rather than expanding monitor national standards in these areas was programs and services as in the more affluent challenged and limited.12 Cutbacks in the previous era, the federal government (as well as foreign aid and defence spending began to provincial governments) began to target social engender criticisms of Canada on the programs to entitled recipients, limit its international front—Canadians could not even expenditures, and cutback on provincial take solace any longer in the image of Canada as transfers even in the crucial and explosive areas a benevolent actor in an increasingly hostile of health, social services and education.10 In world.13 The sensational failure of the return for accepting more responsibility with constitutional attempts at strengthening national less funding, the provinces began to develop a unity and expanding citizen rights and the near stronger sense of ownership and independence loss of the country in the1995 Quebec in these policy areas. referendum, further delegitimized the federal government in the eyes of Canadians.14 The The cumulative effect of the federal effects of globalization on national states only rollbacks in the 1970s and 1980s was that fed perceptions of the Canadian government as Ottawa’s role as a positive force in citizen lives impotent and possibly unnecessary.15 became obscured. Offloading social programs and responsibilities to other governments and third sector agencies meant that the federal government was protected from criticisms for 12 11 See Gerard W. Boychuk, “Social Assistance and cutbacks in services, but also that it lost Canadian Federalism,” in François Rocher and visibility. Provincial leaders’ criticisms of the Miriam Smith (eds.), New Trends in Canadian Federalism, (Peterborough, ON: Broadview Press, 2003), 271-2; Antonia Maioni and Miriam Smith, Douglas E. Williams (ed.), Reconfigurations: “Health Care and Canadian Federalism,” in Rocher Canadian Citizenship and Constitutional Change, and Smith, New Trends, op.cit., 305-9. Selected Essays by Alan C. Cairns, (Toronto: 13 Kim Richard Nossal, “Pinchpenny diplomacy: The McClelland and Stewart, 1995). decline of ‘good international citizenship’ in 10 See for example, James J. Rice and Michael J. Canadian foreign policy,” International Journal 54 Prince, “Lowering the Safety Net and Weakening the (Winter 1998-9), 88-105; Andrew Cohen, While Bonds of Nationhood: Social Policy in the Mulroney Canada Slept: How We Lost Our Place in the World Years,” in Susan D. Phillips (ed.), How Ottawa (Toronto: McClelland and Stewart, 2003). Spends 1993-4: A More Democratic Canada? 14 See for example, Kathy L. Brock, “Executive (Ottawa: Carleton University Press, 1993), 381-416. Federalism: Beggar Thy Neighbour?” in Rocher and 11 John Shields and B. Mitchell Evans, Shrinking the Smith, New Trends, op.cit., 77-80; compare Kenneth State: Globalization and Public Administration McRoberts, Misconceiving Canada: The Struggle for “Reform” (Halifax: Fernwood, 1998), 88-115; B. National Unity, (Toronto: Oxford University Press, Mitchell Evans and John Shields, “Neoliberal 1990), 191-276; and, David Thomas, Whistling Past Restructuring and the Third Sector: Reshaping the Graveyard: Constitutional Abeyances, Quebec Governance, Civil Society and Local Relations,” and the Future of Canada, (Toronto: Oxford Paper presented to the Annual General Meeting of University Press, 1997). the Canadian Sociology and Anthropology 15 See for example, Thomas J. Courchene, A State of Association, University of Alberta, Edmonton, Minds: Toward a Human Capital Future for Alberta, May 29-31, 2000, 17-20. Canadians (Montreal: IRPP, 2001), esp. 28-31.

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By the end of the 1990s, Ottawa realized the mixed public-private model of healthcare need to repair the damage to its reputation with delivery.18 In sum, as the federal government Canadians. Realizing the emphasis Canadians has attempted to redefine its place within the placed on the social safety net in a fair hearts and minds of Canadians and justify its community as a key unifying national role as a national government, it has exacerbated characteristic,16 the federal government began to federal-provincial tensions and triggered a reassert itself in those policy areas. Cash- protective impulse in the provinces. strapped provinces were caught in the bind of desiring federal assistance but resenting federal The Provinces Act and React intrusion into policy areas under their This protective impulse has manifested itself jurisdiction and in which they had grown in the collective provincial thrust towards a accustomed to acting with less interference. qualified acceptance of asymmetrical federalism. More money to the CHST in 1999 meant more In recognition of the distinctiveness of Quebec rigid enforcement of national standards.17 The and its historical sensitivity towards federal same year, the federal government attempted to encroachments on provincial jurisdiction and reassert its leadership in the area of social policy especially social policy,19 the nine provincial by pre-empting an interprovincial agreement and premiers issued their famous 1998 Calgary using financial incentives to induce the Declaration. While this document recognized provinces to sign a Social Union Framework Quebec’s unique place within Canada, it Agreement (SUFA). The Health Accord signed underscored the perspective that any special the following year ensured a federal presence in powers granted to one province must be upholding national objectives at the cost of a available to the other provinces: asymmetry yes more stable federal commitment to healthcare but with equality of opportunity for all. This funding. And so it goes into the 2000s with position reflects both the desire to accommodate further agreements on social spending, child Quebec in the interests of national unity but also care, health and other salient programs as well as the greater emphasis on equality whether at the direct federal action on healthcare research and individual or provincial level in the wake of the post-secondary scholarship. Charter. In constitutional terms, the Declaration is more consonant with the spirit of the In its quest for identity, the federal Charlottetown Accord than the Meech Lake government has shifted from promoting a just Accord.20 society to entrenching rights for citizens to expanding its role in primarily provincial areas of jurisdiction such as healthcare, social 18 Keith Banting and Robin Boadway, “Defining the programs and education. In so doing, the federal Sharing Community: the Federal Role in Health government has set itself on a collision course Care,” in Harvey Lazar and France St-Hilaire (eds.), with the provinces. Particularly in the area of Money, Politics and Health Care: Reconstructing the healthcare, the federal government has set itself Federal-Provincial Partnership (Montreal and Kingston: IRPP and The Institute of at odds with provinces like Alberta, Quebec and Intergovernmental Relations, 2004), 15-18. BC, that are experimenting with the contours of 19 This was, for example, a key factor in the Quebec the system, by nixing movements towards a government declining to endorse the 1963-4 Fulton- Favreau and 1971 Victoria agreements on the 16 Successive polls have captured this view. The constitution. importance of a strong social fabric to Canadians is 20 For a summary of public opinion and the captured in Raymond Breton, Norbert J. Hartmann, distinction between the Meech Lake and Jos L. Lennards and Paul Reed, A Fragile Social Charlottetown approaches to acknowledging Quebec Fabric? Fairness, Trust and Commitment in Canada as a distinct society, see F. Leslie Seidle and Gina (Montreal and Kingston: McGill-Queen’s University Bishop, “Public Opinion on Asymmetrical Press, 2004), esp. 30-39, Federalism: Growing Openness or Continuing 17 See Maioni and Smith, “Health Care and Canadian Ambiguity?”, 6-9. Available online as part of the Federalism,” in Rocher and Smith, New Trends, Institute of Intergovernmental Relations Asymmetry op.cit. Series 2005 at

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other provinces could qualify for the same deal Similarly, at the behest of Quebec in 2003, as Quebec should they desire it, ensures that the premiers agreed to create the creation of the Quebec is accommodated without the Council of the Federation (COF), an entitlements of the other provinces being interprovincial body of first ministers excluding adversely affected. The COF is an impetus the federal government, to focus on areas of behind the asymmetrical arrangements provincial interest including health care, internal introduced by the 2004 Equalization Agreement trade and the fiscal imbalance. COF is intended and subsequent accords responding to the to be the vehicle that enables the provinces to provinces’ perceptions and definitions of a drive the federal-provincial agenda in critical vertical fiscal imbalance. What this deal would areas by encouraging a united provincial front. seem to indicate is that COF encourages the provinces to engage in a united front unless they Of particular interest to the provinces in can cut a better deal for themselves—asymetry forming COF was the vertical fiscal imbalance, becomes raw self-interest without serious defined as the situation arising when one level of concern for the effects on the nation as a whole. government has excess revenue for its spending needs and the other level of government has too The impetus towards asymmetrical little revenue to meet its defined expenditures. federalism is also being driven by the provinces However, as Harvey Lazar observed recently, on an individual basis, largely in reaction to the current public debate “suggests that this is a federal government’s actions in attempting to measurable technical concept. It is anything redefine its role in the nation. Whether the but!” Instead, it is a “political and policy Liberals or Parti Québecois are in office, the concept.”21 To determine efficient tax rates vis- government is expected to assume a tough à-vis expenditure responsibilities in relation to posture against Ottawa and protect that the two levels of government involves assessing province’s sovereignty and autonomy. Opting policy and political considerations, not technical out of national deals involving social policy is a ones. Still, the rhetoric emanating from COF and common strategy of that province.24 Underlying provinces like Alberta, Quebec and Ontario this posture is the threat, driven home by the treats the vertical fiscal imbalance as an 1995 referendum, that without the ability to opt- empirically measurable device.22 out of particular intergovernmental deals with sufficient compensation, Quebec might just opt- These two developments are bearing fruit. out of the federation. But unlike in the past, now The Calgary Declaration was a precursor of the the other provinces expect the opportunity for form of asymmetry embraced in 2004 similar arrangements being extended to them, Healthcare Accord. If rumours are accurate, thus undermining a sense of national purpose according to Tom Courchene the federal government agreed orally to extending the same arrangements to Alberta and BC and thus any and The Old Constitution,” Policy Options 25:10 (November 2004), 27. other province during the final negotiations on 24 23 See Peter Graefe, “Scope and Limits of the Health Accord. The understanding that the Asymmetry in Recent Social Policy Agreements,” Available online as part of the Institute of Intergovernmental Relations Asymmetry Series 2005 http://www.iigr.ca/browse_publications.php?section= at 43 http://www.iigr.ca/browse_publications.php?section= 21 Harvey Lazar, Notes for the House of Commons 43; cf. Alain Noel, “Collaborative Federalism with a Sub-Committee on Fiscal Imbalance, Ottawa, May 4, Footnote,” Policy Options 21 (May 2000), 44-5; 2005, 1, 3. compare Herman Bakvis, “Checkerboard 22 See also André Pratt’s criticism of the fiscal Federalism? Labour Market Development Policy in imbalance debate in “Is Ontario Getting Ripped Off: Canada,” in Herman Bakvis and Grace Skogstad No,” The Globe and Mail, March 16, 2005, A17. (eds.), Canadian Federalism: Performance, 23 Tom Courchene documents this speculation in Effectiveness and Legitimacy (Toronto: Oxford “Pan-Canadian Provincialism – The New Federalism University Press, 2002), 197-219.

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and common interest.25 Furthermore, Ontario provinces with their unique political, social and and Alberta, as key donors to the federation, are cultural configurations desiring some protection. increasingly engaging in a form of beggar-thy- Sir John A. Macdonald’s vision of a unitary state neighbour federalism, begrudging their was repugnant, not only to the fathers of contributions to the national coffers rather than Confederation from Quebec but also from the realizing the flow back to them of the benefits of other provinces-to-be extending up to include the union.26 BC, increasingly despondent with Newfoundland.29 To deny the equal the federal government, is distancing itself.27 participation of the provinces in the creation of The smaller provinces whose concerns are often the federation is to undermine the sense of a diminished or sacrificed to the issues brought collective national project—one that commits all forward by the larger and wealthier provinces, parts equally to making it work. view special arrangements with the federal government as a means of protecting their Second, citing the sections of the interests or at least diminishing the harm done Constitution Act, 1867 that recognize Quebec’s by deals favouring central Canadian and distinct culture, judiciary and linguistic wealthier provinces. And so, underlying conditions as justifications for current asymmetry is a new degree of interprovincial asymmetrical arrangements that apply only to resentment and passive hostility. Quebec and are not theoretically available to the other provinces is potentially dangerous (not to Some further dangers inherent in the mention misleading since, for example, reasoning underlying the drive towards bilingualism in the legislature and courts applies asymmetrical arrangements that especially to Manitoba as well as to Quebec and as of 1982 accommodate Quebec’s specificity in to New Brunswick and potentially to other Confederation need to be addressed. First, provinces Constitution Act, 1982 ss.17.2, 18.2, Quebec is credited with the gift of federalism to 19.2, 20.2 and 43.b).30 Instead of allowing for Canada.28 This is a myth. Federalism was the innovative arrangements that strike result of not just Quebec but also the other accommodations across common provincial interests (Quebec and NB on bilingualism), this 25 logic of dualism (Quebec versus the rest of F.L. Morton, “Equality or Asymmetry? Alberta at the Crossroads,” available online as part of the Canada) may impose a straightjacket on policy Institute of Intergovernmental Relations Asymmetry makers binding them into arrangements that are Series at consistent only with those original defining http://www.iigr.ca/browse_publications.php?section= features of Quebec. To use those original 43 accommodations as a basis for applying 26 See Brock, “Executive Federalism: Beggar Thy different treatment exclusively to Quebec in Neighbour,” in Rocher and Smith, New Trends, op other areas is like using the accommodations cit. Ontario deliberately shifted away from a focus on made for PEI’s small size to justify special Ontario as a leader within confederation to a more self-interested, parochial provincial approach under the Bob Rae NDP government during the 29 See for example, Jennifer Smith’s discussion of the Charlottetown negotiations. This approach has founders as “parliamentarians” and “reluctant continued through the Harris Tories to the McGuinty federalists” in Federalism (Vancouver: UBC Press, Liberal government, some would say to the detriment 2004), 41-54. of Canada as a whole. 30 See for example, justifications for asymmetrical 27 See Gordon, Gibson, “British Columbia: federalism based on this notion of duality expressed Affordable Resentment, Growing Options, Diverging by Kenneth McRoberts, Misconceiving Canada, op. Interests,” in Hamish Telford and Harvey Lazar, cit.; David Milne, “Asymmetry in Canada, Past and Canada State fo the Federation 2001: Canadian Present” and Jennifer Smith, “The Case for Political Culture(s) in Transition (Montreal and Asymmetry in Canadian Federalism,” both available Kingston: McGill-Queen’s with the IIGR and School online as part of the Institute of Intergovernmental of Policy Studies, 2002), 241-61. Relations Asymmetry Series 2005 at 28 See for example, Thomas Courchene, “Pan- http://www.iigr.ca/browse_publications.php?section= Canadian Federalism,” op cit., 21. 43

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arrangements for it in unrelated policy areas. role within the federation for the sake of national Critics would scoff at the suggestion. Using the unity. Fuzzy boundaries between the federal constitution in this context, is to limit the government and provinces have made for potential. Increasingly, this framework may complex and contentious relations. become too constricting for Quebec and may preclude more convincing justifications for an Towards Principled Federalism: or expansive notion of asymmetry beneficial to the Reconceptualizing the Role of the Federal nation as a whole. Government and Accepting the Differences Within This broader notion of asymmetry was Asymmetry has been part of the federal deal captured in sections 91 and 92 of the in Canada since inception. While specific constitution. By extending the same opportunity provisions were made in the constitution for the to all the provinces to pursue different goals distinct nature of Quebec, so too were special within their jurisdiction, the constitution provisions made for other provinces. Further provides for asymmetry in practice. Difference attempts to constitutionalize asymmetry have is tolerated. Similarly, section 129 allows for the and will only bring the dualistic vision of continuous of colonial laws, courts etcetera in all federalism into conflict with competing visions of the provinces subject to defeasance by either of Canada as a federal state with ten provinces Parliament or the province depending on and three territories as the failure of Meech Lake jurisdiction. While it permits Quebec’s unique drove home. However, much more flexibility is institutions and laws to continue, it also provides available to accommodate difference at both the for potential change and thus more uniformity policy and fiscal levels provided equal across Canada.31 These similar formal opportunity of treatment is open to all the units. arrangements allow for considerable diversity in practice. Canadians react favourably to As this paper has shown, the real danger asymmetrical federalism when posed in these arises when jurisdiction is not respected and the terms.32 federal government begins to encroach on provincial territory. Quebec reacts to protect its Asymmetrical federalism is a current reality. right to define and deliver its policies, programs, However, the key point here is that the need for and services to its public. The wealthier special arrangements is largely driven by the provinces push back and begrudge their federal encroachment on provincial jurisdiction contributions to the wellbeing of the nation. And in recent years as a means of reasserting its place the smaller provinces call for extra protections. within Confederation. In the era of retrenchment Tensions mount, governments argue and citizens and rights, it sacrificed its ability to influence the become more disillusioned. The comity that direction of the nation, losing visibility and binds threatens to become unglued. meaning for Canadians. As it has attempted to regain this lost ground, it has chosen to fight the The answer lies in a return to a more battle on provincial jurisdiction thus prompting a principled approach to federal-provincial backlash in the provinces which manifests itself relations and in particular the role of the federal as a desire for more asymmetrical arrangements government. This answer has two components. to protect provincial autonomy. As the sense of First, the federal government needs to retreat comity is weakened and resentment rises with from provincial jurisdiction. Respect the the new asymmetrical arrangements, the federal division of powers set down in 1867. Instead of government should reconsider how it defines its attempting to define national standards and objectives and spending in provincial areas of

31 jurisdiction, the federal government should See Peter Hogg’s reading of this section for a slight withdraw. variation, Constitutional Law of Canada third edition, (Scarborough: Carswell, 1992), 36-38. 32 See Seidle and Bishop, “Public Opinion on This proposal raises four immediate Asymmetrical Federalism,” op.cit., 8-11. objections. One, how do we manage national

Kathy Brock, Accords and Discord: The Politics of Asymmetrical Federalism and Intergovernmental Relations

institutions and programs that have been set up Three, how will nation-wide standards or to assist the provinces in serving their citizens? comparability be set and maintained? In this Either the leadership of these institutions and case, the provinces would be responsible for programs could be assumed by an expanded negotiating standards and objectives, taking into COF and a supporting administrative body. In its account their differences either through COF or initial phases, the federal government could alternatively through a joint federal-provincial provide both the logistical and financial support body with representation drawn from the for this body. Alternatively, in cases where national, provincial and territorial legislatures to shared jurisdiction remains desirable, a ensure political responsiveness. The federal governance structure similar to Canada Health representative would serve as host and as a Infoway could be more widely applied.33 This neutral chair intended to broker compromises would entail responsibility resting with the and ensure fair consideration of all provinces’ Deputy Ministers of the relevant department but special circumstances. This latter proposal active decision-making authority resting with a would provide protection for Quebec and the board comprising five-six representatives from smaller provinces. the provinces and territories on rotating terms and one-two federal representatives, at least Four, in the cases where there is a legitimate initially. Any new institutions would need to be federal interest, for example in a health care negotiated by all 14 governments through the issue affecting the nation as a whole, how should process of executive federalism. it be handled? First, the definition of a legitimate national interest should be narrowly construed. Two, how should federal support continue The provincial inability test constraining federal for these programs? Equalization payments action on the environment might provide some should continue under the present or a reformed guidance here.35 The final arbiter would need to formula when they come up for renegotiation at be the federal government after consultation the end of the five year period. In the area of with the provincial governments and relevant general transfers for social, education and health professional associations and experts. As part of programs, provinces should submit proposals for the process, the federal government could a global figure for federal expenditures over a establish a five person expert panel to advise and five year period based on past transfers. The report on whether it should act or continue federal government would then review this acting in a given capacity. proposal in good faith and then set its final transfer payments. The final decision would lie The default position in all cases should be to with the federal government to ensure respect respect provincial jurisdiction. The federal role for budget accountability. These proposals would be minimal in practice but it should including the justifications for the final amounts undertake a commitment to stable and adequate and the supporting documentation should be financial arrangements to avoid outraged cries of available online either through the federal fiscal imbalance.36 The incentive for the federal finance department or its provincial and territorial department counterpart or both to could operate as a demonstration effect for the other ensure transparency and public accountability. provinces or territories. Consistent with the current mandate of COF, no 35 Peter Hogg, Constitutional Law of Canada 1997 province would be obstructed from negotiating Student Edition (Scarborough: Carswell, 1997), 414- additional side deals with the federal 16; cf. Gerald Baier, “The Law of Federalism: government where warranted.34 Judicial Review and the Division of Powers,” in Rocher and Smith, op.cit., 124-8. He charts the movement away from the test and criticizes it as too 33 See Kathy Brock and John Ronson, “Health Care centralizing. Requires Creative Solutions: Time for Creative 36 “Outraged” is used deliberately here since it is in Federalism,” Toronto Star, September 10, 2004. the interests of the provinces to raise cries of fiscal 34 Of course, the main constraint on this would be the imbalance periodically. A key for the federal self-interest of the federal government. One deal government would be to require a province making

Kathy Brock, Accords and Discord: The Politics of Asymmetrical Federalism and Intergovernmental Relations

government to accept this reduced role but still provide funding both to the provinces and Trade and security (both internal and territories and to the necessary external) are two further areas where the federal intergovernmental or national bodies and government could stand to gain by focusing its agencies is substantial. Canadians want a system efforts on rebuilding a sense of trust among that works with less friction and confrontation. Canadians. Under Lloyd Axworthy as Foreign The federal government would be recognized as Minister, Canada began to make significant a key actor in facilitating a new, more effective advances in including third sector actors in and responsive form of federalism. international negotiations and in contributing to international security through issues like the This leaves the second main issue arising banning of landmines. Border security, from the reflections on the federal government’s immigration (shared with the provinces), the attempts to justify its role in Confederation and promotion of international trade are all areas in the resulting intergovernmental tensions. The which the federal government could play a answer lies in a return to its original jurisdiction. stronger and more innovative role.38 For example, it has been working in cooperation Released from areas of primarily provincial with the provinces on the accreditation of responsibility, the federal government would immigrant professionals, it might press to have an opportunity and the means to focus its expand these efforts with other nations. And efforts. Improving Canada’s image while the forces of globalization tempt the internationally would be the first priority. In a federal government to redefine education as an scathing indictment of the federal government’s issue of human capital and international rhetoric versus the reality of Canada’s response competitiveness and to expand its role in labour to the Darfur situation, Kim Nossal lays bare the market policy, it would be better to leave the sad state of capacity to act on the international core jurisdiction to the provinces who can best stage. The cumulative impact of cuts to the assess the capacity and needs of their citizens. armed forces, foreign service, and development The federal role should be restricted to defining assistance budgets has been to hollow out our Canadian strengths in the global economy based international presence.37 And yet the on cumulative provincial contributions and overwhelming desire of Canadians to believe the assisting provincial efforts to ensure the rhetoric extolling our commitment to serving competitiveness of their workers. internationally and intervening in atrocity crimes that he documents, is indicative of a desire Cultural policy is an important area for among Canadians to see our international image federal government action. Promoting culture restored and strengthened. Similarly, as both internationally and within our borders is mentioned above, Canadians took pride in our key to building national pride and belonging. past image as a peacekeeper in the international Cuts to the CBC television and radio have arena. While this particular image may no longer hampered its ability to provide distinctive and serve in a new globalized environment, the informed insight into current events. Too often federal government needs to buttress our the CBC is reduced to popular tactics similar to capacity to act internationally both in a military the private media rather than offering solidly capacity and in delivering on foreign aid researched programs. Reductions in federal promises. funding have also meant that the presence of the CBC in the provinces and regions has been such a claim to document it and submit the claim to an independent panel of experts selected b the federal 38 For a thoughtful discussion of the deficiencies and and provincial governments. possibilities in our international presence, see Lloyd 37 Kim Richard Nossal, “Ear Candy: Canadian Policy Axworthy, “choices and Consequences in a Liberal Toward Humanitarian Intervention and Atrocity Foreign Policy,” in Howard Aster and Thomas Crimes in Darfur,” International Journal, Axworthy, Searching for the New Liberalism forthcoming 2005. (Oakville, ON: Mosaic, 2002), 63-79.

Kathy Brock, Accords and Discord: The Politics of Asymmetrical Federalism and Intergovernmental Relations

diminished, impoverishing our understanding of from the provinces that will undermine a sense regional and provincial differences and cultures. of collective goodwill and federal comity. The federal government could reach out to Canadians by rebuilding national linkages Canadians have a residual desire to believe through a more robust public media. And in their country as humane, benevolent and fair. promotion of our literature, culture and film Restructuring federal-provincial relations and industries would only enhance Canadian pride the role of the federal government to build on and engender an even healthier nationalism.39 that image can only heighten the sense of national unity by encouraging all Canadians to Conclusion want to be a part of that dream. A dream we In sum, the federal government only needs have all but lost. to look to its areas of jurisdiction to find a means of reasserting a strong presence nationally and rescuing our image on the international stage. In an era of citizen disillusionment with government and skepticism surrounding political authority, this might be a more effective means of restoring democratic legitimacy than either tinkering with institutions with no promise of effective change or continuing to bicker with the provinces.

Asymmetry is natural to a federation as Ron Watts has so thoroughly documented.40 In Canada, history has taught us that formal constitutional recognition of distinctiveness is less popular than asymmetry in fiscal and policy arrangements. Canadians are pragmatists who understand the need for difference in practice. Even arrangements designed to provide room for Quebec’s distinctiveness are justifiable and acceptable to the broader Canadian public provided that an equal opportunity to take advantage of similar arrangements is extended to the other provinces, even if the option is not exercised. However, if the federal government continues along the trajectory of embedding itself further into provincial areas of jurisdiction, it is only likely to trigger more hostile reactions

39 For an innovative way of thinking about culture, citizenship and economic development, see Simon Brault, “The Arts and Culture as New Engines of Economic and Social Development,” Policy Options 26(March-April 2005), 56-60. 40 Ronald Watts, “A Comparative Perspective on Asymmetry in Federations.” Available online as part of the Institute of Intergovernmental Relations Asymmetry Series 2005 at http://www.iigr.ca/browse_publications.php?section= 43