The evolution of the Canadian federation, Mr. Dion asserted, is not the result of formal constitutional amendments, but rather of the gradual disuse of unitary mechanisms, the decentralizing interpretation of the Constitution by the courts, and a host of intergovernmental agreements designed to harmonize the responsibilities of the two orders of government.

After reviewing the causes of the contrasting evolution of the two federations and their respective division of powers, the Minister stated that each federation needs to strike the right balance between, on the one hand, the need for common objectives and, on the other hand, the ability to develop different solutions. The essential goal, he noted, must always be the public interest. "Centralization and decentralization alike would weaken the Canadian federation if they were poorly designed in terms of the public interest. What we need is a federal government that is strong in its own areas of jurisdiction, provincial governments that are strong in theirs, and above all, strong cooperation between both orders of government," he added.

Noting that all major federations provide for a "spending power" for their federal and constituent governments in areas that do not strictly fall within their legislative jurisdictions, the Minister pointed out that the American federal government uses its spending power much more than the Canadian federal government does, but without sparking nearly as much controversy. Nevertheless, the Minister stated, the federal spending power has been a vital element of social development in Canada. "It has been instrumental in building, with the provincial and territorial governments, the Canada-wide social programs which Canadians value, such as Medicare. It has been essential in promoting equality of opportunity for all Canadians, helping to ensure access to basic social programs and services of comparable quality for Canadians wherever they live or move in Canada," Mr. Dion added.

Even though the federal spending power has been used less often and with fewer conditions in Canada than in virtually any other federation, the Minister noted, it is sometimes denounced as a federal intrusion into a field of provincial jurisdiction, as illustrated by the reactions to the creation of a postsecondary student scholarship program. "As a result, federal initiatives that would be considered perfectly normal in other federations are denounced in Canada as a violation of the Constitution and the spirit of federalism. [...] And yet, making education more accessible to students does not constitute meddling in the education field as such. [...] In your country [the United States], 75% of public student aid is provided by the federal government, and no one is complaining," he noted.

Mr. Dion explained that, in the social union framework agreement, the Canadian government developed guidelines for using its spending power in collaboration with the provinces. This requirement for collaboration is unprecedented in other federations, he added. "This new model for intergovernmental transfers will encourage governments to work together and set common objectives, while enhancing their capacity to participate in a way that suits them best. In short, it will encourage participation, reward innovation, avoid duplication and therefore set in motion a ‘race to the top’," the Minister noted.

The continuing quest for a balance between common objectives and varied experimentation is an ongoing challenge for federations such as the United States and Canada but, through positive synergy, it provides for better services to our citizens, Mr. Dion concluded.

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