1. UBC POLI 101 Canadian Politics
The Federal System
(not Constitutional Mega-Politics)

2. Federalism
Separate “orders of government” defined by the Constitution
But not Confederalism: where the higher-level assembly is made up of representatives of governments not representatives of the people
Division of Powers - Constitutionalized
Neither can change this unilaterally
Disputes go to a third party – the Supreme Court
General support in the political culture for the existence of multiple levels of government …

3. Canadians Like Co-operation – But They’re Confused

4. Geographical variation in preferences
Why Federalism?
Prevention of tyranny
Division of sovereignty – tempers Parliamentary Supremacy
“Multiplication of factions” – Madison
Efficiency
Information about citizens’ preferences more reliable
Service delivery more cost-effective
Representation closer to the people (more democratic)
Citizens shop for ‘bundles of services’
Geographical variation in preferences
In Canada: the accomodation of ethno-cultural difference
Recruitment of leaders through the levels of gov’t
Policy Experimentation / Borrowing Ideas & Success

5. Why NOT Federalism? Inequality
different revenue bases mean different levels of service
equalization is inefficient
Confusion undermines responsible government
voters may not be able to hold governments accountable
legislatures may not be able to hold Cabinets accountable
Destructive competition (Race to the Bottom)
A bidding war to attract industry undermines revenue
Entrenchment / exacerbation of geographical conflict. Diversion from more important concerns.
Cost
Duplication / Overlap
Lack of economies of scale

6. Intrastate (within) and Interstate (between) Federalism
Intrastate Federalism: The representation of the units of the federation within the national government (e.g. US Senate – 2 Senators from each State)
Constitution ensures Provincial Representation in Senate and House of Commons
Convention of regional balance in Cabinet
Can be interpreted in centralist or decentralist ways
Interstate Federalism: Interactions between Federal and Provincial gov’ts
Joint programs
Bureaucratic linkages and consultations
Integration of Tax system
First Ministers’ Conferences
Interstate federalism functions more smoothly, or there is simply less need for it, if intrastate mechanisms are legitimate and effective.

7. Development of Canadian Federalism 1 – Confederation +
Reasons for Federalism in 1867:
Deadlock of United Canada’s – “Double Majority” stalemate
Quebec – desire for constitutional guarantee of control over language, education, culture, civil law, religion
Martimes – wanted self-government, feeling of distinct political culture, different economic interests
Logistics – Communication/Transportation slow & costly
But… the shadow of US Civil War
So strong central government with residual power, disallowance, primary power to tax
The objective was independent governments, able to function on their own in ‘watertight compartments’
“we have avoided all conflict of jurisdiction and authority” – Sir John A. Macdonald

8. Division of Powers Federal Provincial Concurrent
Trade and Commerce
Criminal Law
Raising of Revenue
Postal Service
Census / Statistics
Defence
Shipping, Fisheries
Indians, and lands reserved for the Indians
Residual Power
Crown Land (Natural Resources)
Hospitals, Charities
Municipal Institutions
Education
“Property and Civil Rights within the Province”
“Generally all matters of a merely local or private Nature in the Province”
Agriculture
Immigration
Residual Power, s. 91: “to make laws for the Peace, Order, and good Government of Canada, in relation to all Matters not coming within the Classes of Subjects by this Act assigned exclusively to the Legislatures of the Provinces”

9. But in Canada, at the beginning…
Quasi-Federalism?
Remember, federalism is a situation where neither government can infringe on the other’s powers
But in Canada, at the beginning…
Paramountcy – federal gov’t laws stand in case of conflict
Reservation and Disallowance
Residual Power of the federal government
Declaratory Power (public works for national benefit)
Unequal power of taxation  Federal Spending Power
Federal appointment of judges
Macdonald thought of the provinces as colonies

10. Development of Canadian Federalism 2 – to 1949
Post-1867 Empowerment of Provinces
Provinces’ Rights, Strong Premiers – Compact Theory
Judicial decisions undermined residual power
Judicial Committee of the Privy Council (JCPC) in Britain
Limited federal powers to those enumerated in s.91
POGG limited to matters not covered in s. 91&92 (Local Prohibition case ) and to an “emergency power” (Fort Frances case )
Generous interpretation of provincial “property and civil rights” and “all matters of a merely local or private nature in the prov”; with a limited interpretation of federal “trade and commerce” power (unlike USA)
Swing back to centralization, but against JCPC resistance
WWI – federal War Measures Act, temporary centraliztion
Depression: JCPC says not an emergency, so POGG can’t justify federal ‘New Deal’ social programs: welfare, unemployment insurance, pensions, etc.
WWII intervenes and provides the emergency the federal government needs, as well as an economic solution
Quebec opts-out of Canada Pension Plan and Tax Sharing

11. Development of Canadian Federalism 3 – Post-War
Centralization:
1940 amendment adding unemployment insurance to fed.
1949 Elimination of Appeals to the JCPC in Britain
Growth of the Spending Power – Shared Cost Programs
Problems with Shared Cost Programs:
undermines provincial independence
Encourages spending
Reduces accountability
Growth of both levels of government, so less conflict
Tax sharing, tax ‘rental’
But… Equalization allowed provinces to provide similar services
Co-operative federalism: so many problems and opportunities were new – not provided for in the constitution – so negotiation became the rule
Intergovernmental Relations are a key feature of Canada (1000 committees, 500 federal-provincial programs
Illustration: Post-Secondary Funding
Provincial: Operating grants, salaries, scholarships
Federal: Block funding for education, research funds, scholarships
As governments stopped growing, conflict increased

12. Current Canadian Federalism
Executive Federalism: Intergovernmentalism
First Ministers’ Conferences (FMCs)
Ministers’ Meetings
Premiers’ Meetings
Federal cuts
Diminishing federal role and use of spending power
Provinces can be more aggressive against the fed gov
Federal gov’t less able to enforce national standards
SUFA – The Social Union Framework Agreement (1999)
Feds agree to get provincial consent for new programs
Reduce barriers to mobility and equality – no residence requirements
Collaborative policy development and data collection
Enhance accountability by identifying sources of funding
Funding predictability
Didn’t stop conflicts

13. Consequences of Federalism
Cairns: Solidifies provincial societies and encourages provincial politicians to play to provincial identities so… Federal Institutions create Federal Societies!
Larger Government?
Competition for citizen satisfaction leads both to compete or cooperate to deliver more programs than are wanted
Smaller Government?
Race to the bottom – competition for investment