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Archived - Chapter 3:
Concerns Over Blurred Accountability Due to Reduced Clarity in Roles and Responsibilities

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Legislative Roles and Responsibilities

The Constitution assigns a range of exclusive legislative powers to the federal and provincial orders of government. It also explicitly provides for joint federal and provincial jurisdiction over contributory public pensions (such as the Canada Pension Plan), agriculture and immigration.

Taxation

The Constitution also explicitly sets out federal and provincial taxation powers. While both orders of government are given fairly general tax powers, provincial taxation powers are formally restricted to direct taxation. In practice, this constraint has had only a limited impact on provinces’ ability to access major tax fields because most major taxes in use today are direct taxes, such as personal and corporate income taxes and payroll taxes. Constitutional jurisprudence has also confirmed that sales taxes levied by provinces are direct taxes as well. Provinces, therefore, have access to all major tax fields in use today.

The Spending Power

By contrast, unlike most constitutions adopted by federal countries since the early 20th century, Canada’s Constitution does not explicitly provide for a general spending power. Over time, it has become common in practice for both orders of government to spend in areas over which they do not exercise legislative jurisdiction. Transfer payments from the federal government to provinces and territories in support of programs such as health care, post-secondary education, training, housing or child care constitute prime examples.

Shared Responsibilities in Certain Areas Can Result in Less Clarity

In practice, the multi-faceted nature of many policy issues and the emergence of entirely new areas of public policy since the 1860s have resulted in pragmatic arrangements that have contributed to a lack of clarity in roles and responsibilities in certain areas.

There are distinct federal and provincial aspects to many areas, such as the environment, where responsibility for key policy instruments falls to both orders of government. In such cases, federal and provincial-territorial governments have needed to work out how to coordinate their distinct but related responsibilities in the best interests of Canadians.


Current Roles and Responsibilities in Canada


 

Federal

Provincial


Money and banking

 

International and interprovincial trade

 

Airlines and railways

 

Telecommunications and broadcasting

 

Foreign affairs/international assistance

 

Defence and veterans affairs

 

Border security

 

Employment insurance

 

Criminal law

 

Fiscal Equalization

 

Indirect taxation

 

Direct taxation

Pensions and income support

Aboriginal peoples

Immigration

Agriculture

Industry

Environment

Policing

Transportation infrastructure

Housing

Post-secondary education, training and research

Public health

Primary and secondary education

 

Health care

 

Municipal institutions

 

Social assistance and social services

 

Natural resources

 

Administration of justice

 


In efforts to eliminate its deficits during the early and mid-1990s, the federal government considerably reduced program spending both in areas of clear federal responsibility and on transfers supporting areas of primarily provincial and territorial responsibility. Once balanced budgets were restored, and particularly once the federal government began to register significant surpluses, it was able to launch new spending initiatives. But the pattern of new spending that emerged during the past decade has often led to concerns about blurred accountability.

Insufficient Focus on Federal Responsibilities

During the period of budgetary restraint in the mid-1990s, the federal government reduced its spending on core areas of federal responsibility. In some areas, the gaps that resulted have not been closed after eight years of surpluses and rapid increases to overall federal program spending. In other cases, the federal government injected new funds, but without changes in focus that would be required to make federal spending more effective at meeting its goals and adapting to new realities. Examples include:

Use of the Federal Spending Power in Areas of Provincial Responsibility

In parallel to this insufficient focus on priorities in areas of federal responsibility, various initiatives—which have expanded the use of the federal spending power—have been launched in areas of provincial responsibility since the federal deficit was eliminated. Concerns have been raised that these initiatives have often imposed new conditions and cost pressures on provincial and territorial governments. Examples include:

While these initiatives have provided welcome support for Canadians, they and other examples of increased federal spending in areas of primarily provincial responsibility often:

The combined effect of increased federal spending in areas of provincial responsibility, and a lack of focus on areas of clear federal responsibility, has been to raise concerns over increasingly blurred lines of accountability that make it more difficult for Canadians to determine which order of government should be held accountable for specific policies and initiatives.

 

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