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          If I were asked to sum up federalism in two principles, I would choose freedom and solidarity: both the freedom granted to every government in the federation to legislate in the areas assigned to it by the Constitution, and the solidarity that all governments owe to one another in the interest of the country as a whole.

          And if I were asked to choose the two values the most likely to inspire an effective fight against poverty, I would still choose freedom and solidarity: individual freedom in its different political and economic expressions and the genuine solidarity of all citizens toward one another.

          Just as we all have our own idea of the best way to fight poverty, we have our own views on the roles that should be assigned to the federal government and the governments of the constituent entities. But in both cases, upon careful reflection, we seek the best possible combination of freedom and solidarity, both of citizens and of governments.

          At this prestigious conference in which I have the honor of participating today, I would like to emphasize that when it comes to fighting poverty within a federal system, there is not a priori one single division of roles among the two orders of government that would be valid in all contexts, for all policies. The appropriate roles of the two orders of government will vary according to what is intended. But the important thing is that the quest for the best division of roles and optimal cooperation between governments be inspired by the principles of freedom and solidarity.

          When all the governments in a federation, both the federal government and those of the constituent entities, strive to help one another, in the spirit of respect for the freedom of action of each, they give themselves the best capability of helping citizens, including the most disadvantaged. A federation inspired by such a spirit provides perhaps the most effective political system there is.

          In Canada, the fight against poverty has profoundly marked our federalism. Canada is a decentralized federation whose Constitution assigns the constituent entities, known as provinces, numerous legislative jurisdictions of their own. The provincial governments also collect a substantial share of public revenues and thus enjoy great freedom to innovate, to develop solutions tailored to the specific context of their populations. But the federal government also has an essential role, which is to strengthen the solidarity of all Canadians. Our past successes and our future achievements in the fight against poverty have required and will continue to require this combination of freedom and solidarity by all members of the federation.

          I have chosen five examples which show, each in their own way, how Canada’s federal government and the governments of the provinces were able to combine the creativity of each and the solidarity of all to give themselves powerful tools to combat poverty.

          My first example is one of which Canadians are especially proud: our public health system. In Canada, basic health care is publicly funded. It would be unacceptable to us if our less fortunate citizens did not have access to the same health services as other citizens. Actually, the government that invented this public health system was a provincial government, in Saskatchewan. But the government that contributed the most to extending this Saskatchewan innovation throughout Canada is the federal government.

          Our provincial governments make their own health policies. The federal government helps them, notably through funding that comes with only one condition: respect for the moral principles of our public health system, which are: public administration, comprehensiveness, universality, portability, and accessibility.

          Canada, like so many other countries, is facing escalating health costs linked to new technologies and an aging population. We are looking hard for solutions to this problem, and we will find them, as always, inspired by the values of freedom and solidarity.

          The introduction of unemployment insurance in Canada offers an example in which the constituent entities agreed, out of solidarity with the country as a whole, to cede one of their constitutional jurisdictions to the federal government. This occurred during one of the most difficult periods in our social history, the Great Depression of the 1930s. The populations of all the provinces were grappling with enormous problems of poverty and unemployment. The provincial governments did not have the resources to help the multitudes of unemployed. So the federal government considered introducing an unemployment insurance program on a national scale. But the courts had established that it did not have the constitutional authority to do so. Bitter and difficult federal-provincial negotiations ensued. Finally, the provincial governments agreed in 1940, unanimously with the federal government, that a constitutional amendment would allow for the establishment of a federal unemployment insurance system.

          If we have today one of the best unemployment assistance programs in the world, it is because of federal action that was made possible by the consent of all the provinces. This federal policy applies throughout the country, but it is flexible, geared to job market conditions in the different regions. Solidarity must not be confused with uniformity; it must take into account the needs of all.

          If unemployment insurance in Canada is an example of centralization that has been beneficial to the country as a whole, Canadian education policies represent the opposite case, where maintaining responsibilities at the provincial level has yielded good results.

          There is no federal department of education in Canada. Canadian students do not have to write national exams. There are no national education standards. Except for Aboriginal peoples, the federal government does not involve itself in education as such. It provides financial and tax assistance to parents and students, transfers funding to the provinces to finance postsecondary education, and contributes to university research. But teaching staff, educational institutions, the curriculum from kindergarten to university, all come under the constitutional jurisdiction of the provincial governments.

          Each provincial government in our country is fully responsible for its own education policy. That being said, our provincial governments consult one another on their respective experiences, notably through the Council of Ministers of Education, which periodically brings together the education ministers of our ten provinces and three territories.

          This decentralization of responsibilities over education may seem abnormal. We regularly hear calls in Canada for an increased role for the federal government in this area. But the fact is that our students get good results in international competitions. For example, researchers for the Third International Mathematics and Science Study, conducted in1999, conclude that the results for Canada are "extremely good" and "significantly higher" in mathematics and science than the international average. The fact is, as well, that Canada is number one in the world in terms of the percentage of its population which has post-secondary education (2001 Edition, World Competitiveness Yearbook).

          Perhaps because I am an educator by profession, I am convinced that education is the most powerful tool to win the fight against poverty. Canadians with less than ten years of schooling are three times as likely to be unemployed as are university graduates, and have an average personal income of less than half that of university grads. If Canada has one of the most competitive economies in the world, it is in large part because our educational institutions are of high quality. And this has been possible within a federal system that gives the provinces free rein in developing their own solutions.

          The fight against poverty among seniors is one of Canada’s greatest social policy successes. Poverty has been greatly reduced among Canada’s seniors. In 1965, 41% of senior households lived under the low-income threshold as calculated by Statistics Canada. In 1999, that percentage had dropped to 1.8%.

          This success is the result of several decades of sustained efforts by our two orders of government. In fact, old-age pensions constitute – since a constitutional amendment in 1951 – one of the rare fields of concurrent jurisdiction in our Constitution.

          This arrangement has enabled Canada to develop a national old-age pension plan that is managed jointly by the federal government and the provinces. But it has also enabled one of our provinces – Quebec – to set up its own pension plan. While broadly harmonized with the Canada-wide plan in terms of contributions and benefits, Quebec’s plan has enabled the use of the pension fund thus created as a tool for investment and economic development in the province.

          Canada’s record in the fight against child poverty is, however, less enviable; in 1999, 13.7% of children lived in low-income households. But this is the area in which we are devoting most of our efforts today. This stepped-up assault on child poverty is an example not of centralization as with unemployment insurance, nor of decentralization as with education, nor even of coordination in a field of shared jurisdiction as with old-age pensions, but rather of greater cooperation between the two orders of government, each using its own social policy tools.

          Our governments have felt the need to review their family assistance policies. At the request of the provinces, the federal government has increased its financial assistance to low- and moderate-income families through the Canada-wide tax system. To complement this, the provinces have increased the assistance they provide to these families in the form of financial support, daycare or other services. Such assistance varies in accordance with the policies set by each provincial government. Launched in 1998, this major federal-provincial offensive against poverty is known as the National Child Benefit. We should soon gauge the results of this exemplary intergovernmental cooperation within a federal system.

          One of the key roles for a federal government is to oversee the distribution of the collective wealth among the constituent entities. That is what we believe in Canada, at least. We even made it into a constitutional principle in 1982. We want our provincial governments to be able to provide Canadians, wherever they live, with services of comparable quality.

          Since 1957, we have had an Equalization program in Canada whereby the federal government provides financial assistance to the provincial governments whose fiscal capacity is lower than the national average. This financial assistance is unconditional: the provincial governments can use this funding as they see fit within their own areas of jurisdiction. The objective of Equalization is not to make the federation uniform, but to give all the provincial governments a relatively similar capacity to innovate and choose quality policies tailored to the particular needs of their populations.

          This Equalization program represents relatively large sums of money: each and every year, it takes up a little more than 1% of our Gross Domestic Product (GDP). While the size and the calculation of these payments are the object of lively debate, the fact remains that political parties of every stripe and Canadians in all regions of the country support this principle of redistribution between the wealthier and the less wealthy provinces. It is a sign of solidarity among Canadians.

          Universally accessible health care, unemployment assistance, education, assistance for the elderly and low-income families, regional redistribution: I have described five Canadian policies that are also powerful tools in alleviating poverty.

          I have shown that the role of the two orders of government varies greatly from one policy to another: Equalization and employment insurance come under the purview of the federal government; education under that of the provinces; while health, old age pensions, and family assistance are based on a complementarity of roles.

          To be sure, contexts vary greatly from one federation to another. We all know that poverty in Mexico is in no way comparable to what we are fighting in Canada. But the Canada of the 1930s, grappling with the Great Depression, was not a rich country according to the criteria of today.

          If there is one thing I have learned from the Canadian experience, it is that we must never be discouraged by the disagreements that regularly arise between the governments of a federation. All the policies I have described have given rise to difficult debates. In a democratic federation, the federal government and the governments of the constituent entities are often made up of different political parties, each of which has its own political philosophy, its own way of seeing things. When things go badly, such as when poverty is on the rise, disagreements become even more bitter. But these difficulties can be overcome through negotiation, discussion and mutual respect, allowing governments to find good solutions.

          The strength of federalism is not to guarantee perpetual agreement among governments. The federation of Nirvana does not exist. The strength of federalism lies in fostering a positive emulation among governments which, beyond their differences of opinion, respect and feel solidarity with one another, reflecting the solidarity that unites the citizens of the country as a whole.