Mr. Speaker, I will be dividing my time with the member for Wetaskiwin. As is traditional, I will begin my comments by thanking the voters of my riding of Lanark—Carleton for placing their trust in me and for sending me to this place as their representative.
Lanark—Carleton is as large as Prince Edward Island and holds as many people as that province. It is in some respects the most diverse riding in the country and contains within its bounds large tracts of rugged wilderness, much rich farmland, many of the prettiest small towns in Ontario, and also Kanata which is Canada's fastest growing and most dynamic urban area and the home of silicon valley north.
The residents of the riding have long been among the most individualistic and creative of Canadians, from Dr. James Naismith of Almonte who invented basketball, to Captain Arthur Roy Brown who capped a glorious flying career in the first world war by shooting down the Red Baron, Manfred von Richtoffen. In Lanark—Carleton we are, to quote from the motto of Beckwith township, proud of our past and confident of our future.
I will also take a moment to salute a few individuals: my parents, Gord and Leatrice Reid, for their wisdom and perpetual support and my remarkable campaign team, headed by Frank Hall and Jerry Rice, who did so much to win the Canadian Alliance's easternmost seat.
There is one other individual to whom I extend my personal thanks. My primary opponent in the election was Ian Murray, the former Liberal member of parliament. In a national campaign that was characterized by negative campaigning, Ian ran a clean and honourable campaign and was always a gentleman. I salute him for that as he begins his life in private industry.
It is a great honour to serve as the critic within Her Majesty's Loyal Opposition for intergovernmental affairs. As such it is my obligation to set out the parameters of the position my party will take in matters relating to federalism in this new parliament, and to emphasize as well one policy in particular that will occupy my own attention, that of intergovernmental transfers.
On this side of the House we are federalists in the true sense of the term: in the sense employed by James Madison in the 1780s when he wrote
The Federalist Papers
; in the sense that the term federationist was used a century ago in Australia when a federal system was being considered for that country; in the sense that citizens of Switzerland mean when they speak of the way their country divides its powers between federal and cantonal levels of government; and, most important, in the sense that the term confederate was used by the fathers of our own federal system at the conferences in Quebec City, London and Charlottetown in the mid-1860s.
We believe that a federal system ought to consist of two orders of government, each of which is completely sovereign within its own areas of jurisdiction and each of which has no authority whatsoever in the areas of jurisdiction assigned to the other order of government. This is what the great British jurist Albert Venn Dicey meant when he made the startling but accurate observation that:
A federal state requires for its formation...a body of countries such as the...Colonies of America or the Provinces of Canada, so closely connected by locality, by history...or the like, as to be capable of bearing, in the eyes of their inhabitants, an impress of common nationality.
Of course our Fathers of Confederation viewed the U.S. model and chose to construct our own federation a little differently. They judged that the United States constitution had given the federal government too few powers and the states too many.
They therefore assigned to the central government certain powers which in the U.S.A. are given to the states. An obvious example of this is criminal law, which in most federal systems is the responsibility of the state or the cantonal government but which in Canada is a federal matter.
Our fathers were federalists nonetheless in the pure sense of the term and not advocates of a unitary state. Within the sphere of jurisdiction falling to each province the fathers clearly meant for that province to be absolutely sovereign. They also intended the federal government to be absolutely sovereign within its own areas of jurisdiction, with no provincial interference.
Wherever the fathers thought some form of joint jurisdiction would be the best arrangement, and they did not think this very often, they said so overtly, as in section 95 of the constitution which gives joint jurisdiction over agriculture.
Unfortunately this decision to create a less decentralized union has been misinterpreted in recent decades as proof that what was intended for Canada was a highly centralized union in which the federal government could justifiably tinker in matters that clearly fall within the provincial realm of jurisdiction.
The federal government does this by offering to share the cost of provincial government programs and then attempting to impose conditions not only on how the transferred money is spent but also upon the manner in which all provincial moneys in that area will be used.
This may seem a reasonable request, or at least tolerable, when speaking of federal grants amounting to 50% of total spending on a program, the so-called 50 cent dollars of the 1960s and 1970s.
Today when the federal government contributes less than 20 cents to every dollar of health care spending, for example, such demands for compliance to federal standards is clearly intended purely as propaganda, with the provinces bearing the lion's share of the cost of important programs but with the federal government taking as much credit as possible for maintaining standards that it does not take seriously.
This does not happen because the federal government is smarter than provincial governments. It has not happened because the voters who participate in federal elections are more responsible, more caring or more intelligent than the voters who cast their ballots in provincial elections. It has not happened because federal Liberals care more about health care and education than do provincial Liberals, Conservatives or New Democrats.
It has happened solely because the federal government has more revenues than it can reasonably expect to use for its own areas of jurisdiction while the provincial governments lack the revenue raising ability to directly finance their own constitutional responsibilities.
It should be noted that the so-called spending power stems not from any words to be found in the constitution itself, nor even from a supreme court interpretation of some unwritten emanation from a penumbra of the constitution, but rather from a straightforward assertion by successive federal governments that they have the right to disregard the boundaries set out in the constitution and to interfere directly in areas of provincial jurisdiction.
No less an authority than Pierre Elliott Trudeau argued in 1957 that the spending power was completely unconstitutional.
The disadvantages of a situation where taxes are levied by one level of government, and spending is done by another, are well known.
The preliminary report of the Liberal Party of Quebec says the following:
The federal spending power leads to three types of problems.
First, the predictability of funding; with respect to cost-shared programs, for example, the provinces find themselves faced with the progressive withdrawal of federal funding once the programs are established.
Second, the unilateral imposition of federal standards; in the case of conditional transfer payments in areas of provincial jurisdiction, the conditions imposed by the federal government lead to pan-Canadian standards, despite the fact that the provinces have exclusive jurisdiction in the area in question. This is an especially delicate issue for Quebec, given the specificity of its society.
Third, the duplication of measures; one example of this is when a federal program is added to an existing provincial program.
Nor is any of this a recent discovery. In 1930 Mackenzie King stated in the House “It is a pernicious principle to have one government collect taxes and another government spend them”.
Over 100 years ago Sir Wilfrid Laurier warned “It is an entirely false principle according to which one government collects revenues and another government spends them. This must lead always to extravagance.”
I have outlined a serious problem that was not addressed in the Speech from the Throne.
In concluding my remarks, I would suggest that there is a simple solution that could be and should be considered by the House. It is to transfer tax points and tax room to the provinces to allow their tax base and spending base to expand to reflect their important constitutional jurisdiction. This would allow for our federal system to be represented, our constitution to be respected and our most important programs, such as health care, to be adequately financed now and in the decades in the future.
