Notes for an address to the
Standing Committee on Government Operations

Ottawa, Ontario

June 4, 1996

First let me introduce the PCO officials who are appearing as witnesses before this Committee:

Ronald Bilodeau, Deputy Minister and Associate Secretary to the Cabinet, Intergovernmental Relations;

George Anderson, Deputy Secretary, Intergovernmental Policy and Communications;

Marc Lafrenière, acting Deputy Secretary, Intergovernmental Operations

Elisabeth Nadeau, Assistant Deputy Minister, Corporate Services

Eileen Boyd Acting Director - Financial Services

Janet Smith, Principal Canadian Centre for Management Development

This is my first opportunity to speak to the Standing Committee on Government Operations, so I'll try to outline as briefly as possible my vision of the changes we must consider to keep Canada united and make it stronger.

I will thus summarize my vision in terms of two priorities.

• First, to awaken the Canadian identity that is dormant not only among many Quebecers, but also among many other Canadians.

• Second, to rebalance the federation and make it more effective and more harmonious.

Let's start with Canadian identity. We have built a country that recognizes and celebrates linguistic duality, a country that recognizes the virtues of multiculturalism and the power of diversity, a country that recognizes the supremacy of individual rights and the importance of protecting minorities.

From coast to coast to coast, respect for democracy and freedom, tolerance of others, generosity and sharing are values that unite us all and reflect what we are. We should be proud of Canada's history and prouder still of the destiny toward which we are moving.

We must celebrate the great values of solidarity and pride that we are working to disseminate throughout the world. Now let's look at rebalancing the federation. Today, in this time of difficult testing for national unity, we must draw on our experience of properly balancing solidarity and autonomy to adapt our federation to the global challenges that make such a balance more necessary than ever before.

This balance between solidarity and autonomy means that as citizens and as regions within Canada we are both independent and interdependent.

Our federalism in Canada has given concrete practical expression to these ideals of solidarity and autonomy.

On the one hand, we have created a network of social programs and a system of equalization payments to ensure that all citizens enjoy a comparable level of well-being.

We have even expressed this in section 36 of the Constitution Act, 1982, which commits the Government of Canada and the provincial governments to promoting equal opportunities for the well-being of Canadians and to providing essential public services of reasonable quality to all Canadians. It also commits Parliament and the Government of Canada to the principle of making equalization payments to ensure that provincial governments have sufficient revenues to provide reasonably comparable levels of public services at reasonably comparable levels of taxation. This is the strongest commitment to social solidarity that can be found anywhere in the world.

On the other hand, our constitutional division of powers expresses our commitment to an extensive local autonomy.

In the Speech from the Throne, the Government announced a number of major initiatives that will make it possible to strengthen Canadian solidarity and thus give the provinces even greater autonomy than they have now.

First, the federal government has limited its spending power. It is the first time that the federal government has offered such a limit on its powers outside the context of formal constitutional negotiations.

Second, in terms of existing programs, we will be exploring with the provinces new and cooperative mechanisms for maintaining national standards.

Third, we will work with the provinces to establish clearer lines of responsibility between different levels of government. For example, the federal government has undertaken to withdraw from fields of activity that are more appropriately the responsibility of provinces, such as forestry and mining development, recreation and, above all, labour-market training.

Fourth, the federal government will continue promoting Canada's economic union by taking measures toward greater interprovincial free trade and labour mobility. We propose to establish a Canadian securities commission in co-operation with interested provinces, which will facilitate capital flow. The Governement has also proposed to create a national revenue collection agency in order to improve cooperation with all provinces in that area.

Fifth, we are also committed to entrenching in the Canadian Constitution regional vetoes and recognition of Quebec as a distinct society within Canada.

Fairness and justice are the two fundamental principles guiding the Canadian social solidarity. Our country has traditions of social solidarity that we will always have to preserve, no matter what changes we make.

The Canada Health Act, for example, is there to give all Canadians access to a comparable level and quality of health care.

The new Canada Health and Social Transfer will guarantee at least $11 billion in funding transfers each year, and will give the provinces better protection. It will re-establish stability and predictability for the provinces and give them financial support that is comparable from one province to the other. And, above all, it will preserve health insurance and social programs.

Social solidarity does not end there, however. Canadians benefit from a wealth distribution program that is unique in the world. I am talking, of course, about equalization, which enables all the provinces to offer public services of comparable quality. That program is entrenched in the Constitution and is one of the major unifying elements of the Canadian federation.

By strengthening the balance between solidarity and autonomy, we will make the federation more harmonious and reduce the number of existing or potential disputes between the provincial and federal governments.

There is thus work to be done in that respect to improve the productivity and complementarity of the federal and provincial governments. We are determined to eliminate unnecessary overlap and duplication by dividing responsibilities between the different levels of government more clearly.

The Government has already accomplished a great deal in recent years. The Program Review, the Improving the Efficiency of the Federation Initiative, and the budget measures, have put the Government on the path of streamlining and frugality.

We are thus off to a good start in modernizing the federation, but we still have a long way to go. The first objective is and must continue to be the delivery of top-quality, more effective services to citizens, by the most appropriate level of government, the private sector, or a combination of the two.

A clearer division of the roles of the two orders of government and more effective co-operation that is better tailored to citizens' needs, will help to get us back on track with regard to unity.

The upcoming first ministers' conference is an integral part of that process of modernizing the federation.

The meeting will give the first ministers an opportunity to talk about how governments can work together better to create jobs in Canada, guarantee the social safety net, and develop a common agenda for change to renew the country.

That is why I intend to devote my efforts to rekindling Canadians' will to be together.

I will be very pleased to answer any questions you may have.

Check against delivery.

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