Political Systems A Focus on Canadian Federalism and Centralization

1) Introduction: While states can be dived along presidential/parliamentary/hybrid systems, there is also a wide range of practices relating to the “power” of central governments Experience has suggested problems with “centralization” in some settings.... “Centralization”: Concentration of power in a single body of government. In practice there are three systems of government relating to centralization: Unitary, Federal and Confederal

All states have central and local/regional governments But... powers of local/regional governments vary Determined by constitutions Question: How do different governments relate with one another? Is the central government “supreme” Are there power struggles?

2) Unitary Systems: “ Unitary Systems ” : Political system that concentrates power within the central government Local/regional governments very weak Examples? Iceland, New Zealand, Netherlands, Japan Britain? Benefits? Uniform national policies Local authorities do what they are told Efficiency Mobility

Drawbacks: Poor at responding to needs of citizens at local level Delegated Authority = “ Delegated Authority ” : Some powers may be formally delegated in a unitary system to local governments, based on functions being better provided at that level. E.g. Central governments usually “charter” towns or cities to take responsibilities for certain issues –Powers of those jurisdictions are outlined in central government legislation

Drawbacks: Poor at dealing with “political economy” of different regions – geography often creates different interests Decentralization = “ Decentralization ” : Some powers may be formally transferred to a lower level of government – with more independence and control over policy E.g. Paraguay – New constitution in 1992 – A “decentralized” unitary state –Created elected governors and councils to replaces ones appointed by central gov. Central government still controls most issues, but local governments more responsive

Drawbacks: Poor at dealing with regionally concentrated ethnic/linguistic/national differences Devolution =“ Devolution ” : A wide range of powers are transferred to a regional government – representing a different nation E.g. Scotland and Wales have new “national assemblies” within the United Kingdom Both also send MP’s to Westminster In Unitary states, powers granted by Devolution are still subject to central authority – they can be taken away

3) Confederal Systems: “ Confederalism ” : Political system in which power is divided between central and regional governments. In confederal states, real power rests at the regional level – central governments have “pooled” powers granted to them under limited circumstances E.g. look after issues on behalf of regional governments – National defence, foreign relations etc. “Real World” examples???? United States (18 th century) The “European Union”: Union of 27 states. Has parliament, and has control over foreign policy, economic affairs and more....

4) Federal Systems: “ Federalism ” : System of governance in which power and responsibilities are formally divided between central and regional governments. Local/regional governments = “ States ”, “ Provinces ”, “ Lander ” Regional governments’ powers are “constitutional” – they cannot be changed without their consent = divided sovereignty Separate “jurisdictions” Regional governments have important independent sources of revenue Examples: U.S., Canada, Australia and Germany

Most “federations” are products of “political expediency”. Federalism was necessary to state formation.... Example: United States Example: Canada Results in different dynamics from unitary states – regional governments (states and provinces) are indivisible, but the same may not be true of the central government....

Like Unitary States, “Federations” can be more or less centralized... depends on political factors: “ Centralized Federalism ” : Central Government retains most real power Can be constitutionally driven.... But also maybe a pattern that emerges due to financial strength of central governments

Like Unitary States, “Federations” can be more or less centralized... depends on political factors: More decentralized federations? Switzerland? Canada???

Benefits? Regional accommodation! Problems? Inefficiency – duplication of services Mobility problems Uneven policies... Some provinces have more $$$$$$$ than others....

Duplication of authority and services E.g. North American Free Trade Agreement (NAFTA) Canada, US, Mexico are all federations – some areas of trade and economic policy involve four levels of “government” “Multilevel governance” is much more complex, time consuming and can be inefficient....

Benefits? Regional accommodation! Problems? Inefficiency – duplication of services Mobility problems Uneven policies... Some provinces have more $$$$$$$ than others....

5) Canadian Federalism: Canadian federalism is constitutionally-entrenched. Provinces have powers the federal government cannot change Constitution Act (1867) assigned specific jurisdictions to federal and provincial governments and some jurisdictions to both.... E.g. “Concurrent Powers”: Shared jurisdictions where both governments have significant authority Direct Taxation, Immigration, Agriculture etc. Division of Powers: The constitutional division of responsibilities between provinces and the federal government in Canadian Federalism VERY POLITICAL – Federalism, and struggle over provincial and federal “rights” dominates politics and public policy in Canada

Federal government also has powers of: “Reservation”: Lieutenant Governor can send provincial legislation to federal cabinet for approval “Disallowance”: Federal cabinet can (in theory) veto provincial legislation In theory, Federal government should have had most power, but things have not really worked out that way.... Canadian federalism has gone through periods of centralization and decentralization

Canadian federalism has a problem: Federal government was assigned most of the “important” responsibilities (in the 19 th century) Federal Gov ’ t has most of the money – power to tax and raise revenues is clearer In the “real world” provinces have most of the spending responsibilities (health, education and social services) but limited money = When combined with high levels of regionalism, ethnic nationalist tensions, etc. Canadian federalism has had to evolve

Canadian Federalism – Phases: Early years: British JCPC (Canada’s Supreme Court until 1949) interprets the Canadian constitution “weirdly” – supports provincial rights Transfers new powers to provinces at expense of federal government – provincial jurisdiction grows

Canadian Federalism – Phases: “Cooperative Federalism”: Governments cooperate and coordinate policies regardless of jurisdictions – effective centralization After World War II, public wants bigger social programs – provincial jurisdictions, but provinces have no money – solution: the “power of the purse” Federal government intrudes in provincial jurisdiction, creating national programs (E.g. Medicare) Provinces get “Conditional Grants” to deliver the programs “Unconditional Grants”: Federal “transfers” to provinces to support their activities E.g. transfer payments, equalization etc.

Canadian Federalism – Phases: “Executive Federalism”: A more conflictual style of federalism where provinces have tried to achieve greater autonomy from federal control Political executives of provinces and federal governments meet to negotiate national policy goals Federal financial problems have weakened ability to influence provinces since 1980s Provincial governments’ jurisdictions seem to have grown E.g. Trade, finance, climate change....

Problems with Canadian federalism: Duplication.... Provincial variation in programs and mobility.... Ambiguity about jurisdiction creates constant bickering over programs Provinces are not all equal... Some provinces have valuable natural resources and some do not... Many of them are going “broke” in the era of “Executive Federalism” Demands for “Equalization”!

Federal Government “ transfer payments” to provinces 1. General CHST transfers to support programs 2. “ Equalization ” : A system of additional transfers to provinces that lack tax base to afford equivalent programs to “better off” provinces Principle of Constitution Act (1982) Transfers to “ have not ” provinces

Finacial challenges of Canadian federalism: Example – Newfoundland NL Gov ’ t Revenue comes from: Provincial taxes +CHST +Equalization +Oil Revenue (Atlantic Accord) =$$$$$$$ NL briefly had more revenue per person than any province in Canada However... New program 2007(!)

NLPENSNBQCMBSKBCTOTAL ,3861,4515,5391, , ,3081,4777,1601, , ,2941,4927,6222, ,918

Financial challenges of Canadian federalism: Like the other attempts to manage Canadian federalism, equalization has generated political controversy and tension – illustrates drawbacks of federalism????