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CAUT Bulletin Archives

February 1999

Power to the Provinces?

David Robinson
It's all eerily familiar. The secret negotiations, the public saber-rattling, and the endless trial balloons -- federal and provincial negotiations over the structure of the Canadian Confederation have once again grabbed headlines. And in the process, a once obscure term - the "social union" - has emerged.

But what is meant by the "social union" and how will it affect Canada's social programs? The answer lies buried in eight pages of obscure prose that nine provinces and two territories agreed to last week.

In bureaucratic terms, the social union refers to a range of national cost-shared programs, such as health care, post-secondary education and social assistance, and the manner in which these programs are administered, funded, and delivered. The agreement constitutes a new social union, therefore ostensibly restructuring the distribution of social policy responsibilities, resources and powers between Ottawa and the provinces.

While the full meaning of the agreement is not entirely clear, we do know that it limits federal spending powers. The federal government is prevented from initiating any new social programs without the consent of six provinces. While the two levels of government will set objectives, the details will be left to the provinces.

This restriction will clearly undermine any new national social initiatives and lead to a patchwork of different programs across the country. Indeed, Ottawa's much vaunted National Child Benefit (NCB) program may provide us with a sign of things to come. Celebrated by proponents of a more "flexible" and "decentralized" approach to social policy, the NCB combined and increased the value of two existing programs: the Child Tax Benefit and the Working Income Supplement.

However, tied to the increased federal credits is another more troubling change: as the federal credit increases, provinces and territories can decrease benefits for social assistance recipients. The money saved on welfare is supposed to be "reinvested" in other programs for low-income families and children. However, in keeping with the philosophy of greater provincial flexibility, there is no common set of standards detailing where or how or even whether this reinvestment will take place.

The provinces are relatively free to decide what to do with the savings. A few may opt to provide more services, such as publicly-provided and regulated child care. Others, more inclined to downsize government and shift the provision of public services to the private sector, may provide additional tax credits and encourage parents to purchase for-profit and private child care. Some provinces may just pocket the savings. No matter where or if the money is spent, the result is clear. Any hope for the creation of a common set of services, such as a national day care program, has been dashed by the NCB. New initiatives now being contemplated, such as pharamacare or home care, will face similar constraints. As well, the long-standing desire by many in the university and college community to establish common national standards for post-secondary education will run up against the same hurdle.

In fact, if the NCB model is to serve as the template for future programs, it is likely that any future increase in federal transfers for post-secondary education will be delivered with the same degree of "flexibility." Provinces would likely be given, if not demand, the right to allocate new funding in a manner they see fit. This could mean, for instance, extra funding being funneled into poorly designed student loan programs or education credits, rather than in a direct and badly-needed reinvestment in the human and physical infrastructure of publicly-funded universities.

The only national standard enshrined by the new agreement is "mobility rights" - designed to lower "barriers" that discriminate against out-of-province residents. One such barrier, Ottawa says, is differential university and college tuition fees. While mobility rights for students are important, the problem is that these rights are the only national standard the provinces must uphold.

But without other standards, such as guarantees of accessibility and affordability, mobility rights alone will have the effect of punishing signatory provinces, like British Columbia, that choose to keep tuition fees low. Faced with having to provide access to non-residents fleeing high tuition fees at home, these provinces will be under enormous fiscal pressure to raise their fees in order to harmonize with other provinces.

While the social union talks were sold as a response to Quebec's demands for greater independence, it is clear the conservative provinces seized the agenda, using the fear of Quebec sovereignty as an excuse to wrestle control of social policy. Ironically, the premise is that Quebec should be accommodated by treating all provinces as if they were Quebec.

This strategy is deeply flawed. It provides an insufficient recognition of Quebec's distinctiveness and undermines our national social programs. It is a tired and failed formula, one that was rejected in the Charlottetown Agreement referendum.

The real objective is stripping federal powers, not achieving national unity. Why else would Mike Harris and Ralph Klein be so happy about an agreement that leaves out Quebec.

David Robinson is the coordinator of CAUT's public awareness campaign.