"The Quality of Public Service in the
Canada of Today and Tomorrow"

Notes for an address to the
Institute of Public Administration of Canada
(National Conference - IPAC 96)

Victoria, British Columbia

August 28, 1996

As a member of your association since working on my Master's degree, I have had the honour of publishing four articles in the journal Canadian Public Administration. I have prepared presentations for your national conferences, but have not had the pleasure of attending in person, because I was never able to come up with the necessary funding. The presentations were therefore given by my colleagues, James Iain Gow of the Université de Montréal and Jacques Bourgault of the Université du Québec à Montréal.

Who knows, perhaps one of my subliminal motivations for entering politics was to get an invitation to come here as your guest, and thus have the pleasure of speaking face-to-face with my colleagues in the field of public administration!

That's why I'm so happy to finally be able to meet with you, particularly here in Victoria, the picturesque capital of British Columbia.

I am especially pleased to be addressing an audience of public administrators and public administration specialists, because I strongly believe that public institutions play an important role in helping societies to work effectively; that's true today, and it will be just as true in the next century.

There is a tendency to believe that public institutions count for less and less, and that the markets are all-powerful. I am convinced that is not true. To give you a concrete example, national borders still matter a great deal, despite international market forces. Belonging to a single country greatly facilitates trade and the functioning of markets. That was true yesterday and will still be true tomorrow, despite the trend toward market globalization.

In that regard, I will cite the study by John Helliwell of the University of British Columbia, who asked Canadians the following question: After adjusting the effect of size and distance, do you think Canada's provinces trade more with one another than with the U.S. states, or less? And by how much? A fair number of people seemed to think the volume of trade was about the same, and many felt that the provinces traded more with the U.S. than with one another.

And yet, the study in question demonstrates that in 1990 -- the latest available data -- after adjusting the effect of size and distance, Canadian provinces trade about 20 times as much with each other as with U.S. states. The effects of Free Trade and NAFTA may have slightly reduced the difference, but the fact remains: the Canadian political union greatly increases the degree of integration within the Canadian economic union.

Why are borders still so important in a global marketplace? Because within a country, we share common public institutions: an integrated banking system, a single currency, a common legal system, and well-established relations among the provinces, companies and people. And we have something called national solidarity. The Canadian common market works in large part thanks to our common political and social union.

Personally, I have chosen to study public administration as a political science professor because to understand political theory and more global issues, you first have to understand the state. The state is not an abstract notion, it is a set of institutions, of people, flesh and blood, thinking and working, and you have to understand them and know them. My model is Alexis de Tocqueville, who was both a great free thinker and a great public servant.

I'd like to talk about the public institutions we share that embody our federalism. It couldn't be a more appropriate topic following the Annual Premiers' Conference in Jasper, at which our public institutions were discussed at length. The premiers have done a remarkable job in pursuing the initiatives launched by Prime Minister Jean Chrétien in the Speech from the Throne in February and during the First Ministers' Meeting in June.

The premiers have asked the right questions, namely maintaining and improving the quality of services that people receive from their governments, especially in the fields of health and social services. We want to work with the provinces to find the right answers.

And I know that you will help us to find those answers, because public service lies at the heart of your expertise and your experience. It doesn't matter if the solutions you propose are controversial or open to criticism; what is important is that they provide food for thought. In that sense, I would reiterate what Premier Harris has said of the work of Professor Tom Courchene, our colleague from Queen's University, and I quote: "I think it is a very sound intellectual piece that will provoke discussion over the next year."

What Courchene, Harris, Chrétien, Klein, Clark, and all of us are seeking is better service to the people, a value which must be our guide. It is the key to improving our federation and keeping it united.

My presentation today has three components. First, I want to explain the perspective from which I believe one can best understand the nature of Canadian federalism. Second, in a manner consistent with this perspective, I want to diagnose the state of our federation. Third, I want to propose some possible ways to improve and strengthen our federation.

Diagnosis

Too often, our federal-provincial debates focus on symbolic abstractions, not daily realities for citizens. I want to suggest that the best perspective for dealing with issues of national unity is a focus on providing service to people.

Public service must be our watchword. If all Canadians were focused on the benefits of the public services we enjoy because of this federation, I am sure that nobody would be discussing breaking it up.

Providing effective public services means recognizing certain basic principles for government action, and often requires balancing competing values with each other. Let me discuss two balances governments must work towards: the balance between recognizing equality and diversity, and the balance between solidarity and subsidiarity.

Let's consider some examples. The federal government makes equalization payments to some provinces and not to others. This does not make the provinces unequal: instead it assures that all citizens have comparable public services no matter where they live in Canada.

When the federal government works with the B.C. government to assist coastal communities and laid-off fishers because of falling salmon stocks, it does not necessarily follow the same pattern that is used to compensate Saskatchewan farmers in the event of a bad harvest, because the contexts are different. Governments must recognize that all citizens are equal, but then respond to a diversity of needs and circumstances.

Equality of treatment does not mean uniformity of treatment. Public service falls to mediocrity when equality is confused with uniformity. We wouldn't want our hospital beds to be designed by Procrustes!

This is the same principle that underlies the controversial issue of recognizing Quebec's linguistic and cultural difference as a fundamental characteristic of Canada. It responds to a unique need and circumstance, without undermining the equality of provinces or of citizens.

Another important balance is the one between the principles of solidarity and subsidiarity. Solidarity, the sense of common good and compassion for our fellow citizens, allows us to act together, in common, to pool our strengths.

Subsidiarity, the principle of local autonomy and self-government, allows us to build on local strengths, on adapting to the needs of each region and each province of the country.

Government must balance these competing principles -- equality and diversity, solidarity and subsidiarity -- if we are to be effective in providing the best possible public services to citizens.

It is too easy to lose sight of this balance of principles, and the focus on the provision of services, and to start to look at federal-provincial relations as a zero-sum game. Concentration or devolution of government power is often looked at not from the point of view of will it benefit the user of services, the citizen, but whether it is a "win" or "loss" for one level of government.

A pitfall to avoid would be to lose sight of the value of public service and consider how our federation works only in terms of a power struggle. I am sure you have read, as I have, many articles that wax eloquent about the division of federal and provincial responsibilities only in terms of who gets what, without ever devoting one paragraph, one sentence, one line to the aspect of public service. And yet, it is citizens' health, safety and welfare that are at stake.

In Quebec, for example, too many thinkers and politicians side with the Government of Quebec and rashly equate any increase in its powers with the interests of Quebecers. They let compliance with the so-called traditional demands of Quebec monopolize their thinking on the issue of the division of roles between Ottawa and Quebec City. They completely lose sight of the value of public service.

The famous "traditional demands" are an obligatory reference, an imperative, a conditioned reflex that takes the place of reasoning. Anyone who dares take away from those "traditional demands" by suggesting a less restricted role for Ottawa is too often accused of having a paternalistic, arrogant and contemptuous attitude toward Quebecers.

I have always deplored that way of thinking. The truth, in my opinion, is that the federal government is also the government of Quebecers, who bring to it their culture and their talents. Their federal government can only serve them well by exercising its legitimate responsibilities.

There is provincialist bias in other provinces as well, but there is also another error, a misplaced kind of Canadian nationalism which in this case is just a knee-jerk in favour of federal power. It equates Canada's interests with increased responsibilities for the federal government and calls on it to be active in every field. Without an omnipresent federal government, it is thought, the Canadian identity would be threatened and the country would disintegrate.

I believe, on the contrary, that the fact that we are a federation, and that Newfoundlanders and British Columbians can have different ways of being Canadian, is one of Canada's strengths. By letting each province come up with solutions adapted to its needs, we make Canada greater. We all know how Saskatchewan inspired all of Canada through its efforts in establishing Medicare.

It is not a question of creating ten self-centred republics, or confusing a strong Canada with an omnipotent federal government, but of striking the right balance between our equality and our diversity, between solidarity and subsidiarity. And if any country needs such a balance, it is Canada, because of its enormous territory and diverse society.

The Shape of the Federation

According to the principles I have outlined, can we say that our federation works well in terms of service to the public? I have spoken a great deal about this in other speeches, so I'll just touch on it briefly here.

You know the socio-economic and human indicators that show that Canada is a success. Of course we have problems; we mustn't pretend that we don't. Nevertheless, we stack up pretty well against other industrialized countries. Year after year, the UN ranks Canada number one in terms of quality of life; and has also ranked us number five among the industrialized countries in terms of per-capita income; Canada also had the second highest rate of economic growth among G-7 countries between 1960 and 1990; and, for the past three years, we've had the second lowest rate of inflation of all G-7 countries.

So, Canada is a country that compares relatively well to our fellow members of the club of rich countries, but we still need to do better. There is too much unemployment, too much poverty, especially for our children. We must consider it a shame that as one of the wealthiest countries overall we lag behind most of the OECD with respect to child poverty.

To improve Canada, we don't have to criticize its basic foundations, but to build on its strengths. Being a federation is one of those strengths, because federations compete well with unitary countries. It's no accident that four of the five richest countries in the world -- Canada, the United States, Germany and Switzerland -- are federations. It's precisely because federations are well-positioned to strike a balance between solidarity and subsidiarity that they do so well.

The Canadian balance consists of both a strong subsidiarity-- our federation is the most decentralized in the world, along with Switzerland -- and a strong solidarity: Canada is a very generous federation. No other federal system has an equalization mechanism as developed as ours, or a constitutionally guaranteed right of comparable services for all citizens, no matter where they live.

To improve our federation, we must build on that balance. And that brings me to the third part of my speech: we know what shape we're in, so now let's find ways to improve things.

This is where the initiatives come into play that were proposed in the Speech from the Throne in February and discussed at the First Ministers' Meeting in June, as well as at the Premiers' Conference in Jasper from August 21 to 23.

To show you how the federal government sees that change, I'll talk only about a few key issues: manpower training, health, forests, and fisheries, since we have the honour of being in British Columbia.

I'll conclude after that, because I'm sure I'll have run out of time by then, but I could give you many other examples as well.

Manpower Training

Let's start with manpower training. It's an important sector, because specialists tell us that countries such as Canada cannot maintain their competitive advantage if they don't have a highly skilled labour force. There are now so many countries offering cheap labour that, if we wish to remain competitive while paying the wages our labour force demands, that labour force must be very skilled indeed.

Historically, the federal government entered this field for legitimate reasons. The federal government is constitutionally responsible for Unemployment Insurance, and introduced programs to help get workers out of the cycle of unemployment. Yet some of these programs were similar to vocational training programs offered by the provinces under their responsibility for education. Now the government has acted to eliminate any conflict or overlap.

We are not the only ones with that problem, however. Manpower training is an area that governments were neglecting, and then suddenly all wanted to get into, which gave the impression of blundering and overlap. For example, France now has some 2,300 different employment assistance measures. That plethora of programs apparently stems from cities, departments, regions and the central government all implementing their own measures without paying much attention to what the others are already doing.

Here in Canada, rather than not reacting, we're going to build on those things that make us strong, by giving the provinces clear responsibilities in this field, but without breaking Canadian solidarity. We want to have good job training programs throughout the country, and we want them to be complementary. Control by the provinces must not hinder labour mobility, because that would considerably damage our socio-economic union and our collective ability to take action.

What my colleague Doug Young, the Minister of Human Resources, is negotiating with the provinces is a general framework giving the provinces responsibility for active employment measures and manpower training; the federal government will act only where responsibilities are clearly pan-Canadian or multilateral in scope.

Let's take one example. If the Atlantic groundfish disappears, affecting five provinces, those provinces cannot act effectively in isolation. For multilateral problems of that kind, the relevance of federal intervention is obvious.

The federal government must also ensure that all provinces have access to equitable funding in accordance with their needs. That funding comes from the Employment Insurance Fund, which is under federal responsibility.

The negotiating framework is flexible, and gives those provinces that want it maximum autonomy. The others that opt for maintaining the federal role in active employment measures will be able to count on federal support. Here again, equality does not mean uniformity.

Health

Now let's look at health, social services, and national standards, the main topics of discussion in Jasper from August 21 to 23.

Let's begin by debunking some myths and exaggerations. I do not believe that the Canada Health Act is the soul of Canada. Our federation has existed since 1867, whereas the CHA as we know it was passed only in 1984.

I do believe, however, that the health system Canadians have built helps to give them a level of well-being and a life expectancy that are almost unequalled in the world. As well, Canadians can be proud of having developed a social safety net comparable to what is enjoyed by Europeans, even though, here in North America, our giant southern neighbour has a very different social perspective.

The Canadian system of health and social protection is based on strong subsidiarity: the provinces manage and deliver care and services. It is also based on strong solidarity among all Canadians. The federal government contributes to that solidarity by transferring funding to the provinces, provided that they respect certain moral principles on which there is consensus in Canada.

Those principles are few in number and in no way constitute a straitjacket. Moreover, they have been made more flexible with the recent implementation of the Canada Health and Social Transfer. Those principles are as follows: universality, accessibility, comprehensiveness, portability and public administration, with regard to health; and no residency requirements for social assistance.

Those principles correspond to a social imperative: the absence of federal transfers conditional upon compliance with those principles could lead to a "race to the bottom" type of Americanization of our health system and threaten Canadians' constitutional right to comparable services throughout the country.

But those principles also reflect economic concerns. A private, American-style health system places tremendous costs on businesses, making them less competitive. In fact, U.S. car makers spend more on health insurance than they do on steel. It is no accident that Canada, which represents 6.8 per cent of the North American automobile market, generates 15.8 per cent of automobile production.

If Canada had ten very unequal health systems, and a patchwork, compartmentalized system of social protection, labour mobility would be adversely affected. The social union and the economic union reinforce each other. And one of the merits of the Courchene report is that it demonstrated that fact again so eloquently.

Incidentally, federal intervention in the health sector entails minimal administrative costs, contrary to what is too often heard. There is a legend that Health Canada employs 8,000 people whose only task is to monitor the provinces and duplicate their activities. In point of fact, Health Canada has only 6,400 employees in all for the 1996-1997 fiscal year. So, how many of them do you think are responsible for enforcing the Canada Health Act?

Do I hear 6,000? 3,000? 1,000? 500? 100? Not even close! The actual figure, ladies and gentlemen, is 23: not 8,000!

The rest of Health Canada's employees deal with responsibilities that logically fall under federal jurisdiction, such as Aboriginal health services, drug regulation, and prevention of epidemics. After all, it would make no sense to require drug companies to have the results of their clinical trials approved by 10 governments!

It is also noteworthy that this federal intervention is completely constitutional. The division of responsibilities in the Constitution refers to legislative power, not spending power. Federal spending power within jurisdictions of member states exists in all federations. It is considered a prerequisite for flexibility. There is only one federation where spending power is subject to the approval of the majority of member states, and that is ours, ever since the commitment made to that effect in the Speech from the Throne in February. The Government of Canada thus made an important move toward more harmonious, consensus-driven relations between the federal government and the provinces.

We realize that the area of health care has become a field of federal-provincial conflict. It is understandable, as the federal government for fiscal reasons has had to reduce its contribution to health care, that provinces feel they should have more flexibility in the design and implementation of our national health care system. The federal government has used the route of financially penalizing provinces that violate the five principles only rarely and reluctantly, but we recognize that there is a desire for more consensus in the way the principles of the Canada Health Act are enforced.

The federal government fully supports examining more consensus-driven, effective mechanisms, together with the provinces. That's why a joint federal-provincial committee will be struck to that effect, which will be co-chaired by Minister Doug Young and an Alberta minister representing the provinces.

Forests

I'm sure you'll recall that the Government of Canada is committed to withdrawing from what have become known as "the five sisters": forestry and mining development; tourism; social housing; and recreation. Some people have actually claimed that those sectors are unimportant, that they are only minor areas. I can't believe they could say such a thing. Do they really think that forestry and mining, for example, are not important to the Canadian economy and the well-being of Canadians?

Let's look at forestry, since we're in British Columbia. Canada's forests sustain an industry worth $44 billion a year, accounting for 25% of all manufacturing investment and more than 750,000 direct and indirect jobs.

Forest products form the lion's share of Canada's net trade balance. No province is in a better position to attest to that than British Columbia, where forestry accounts for 62% of the province's manufacturing industry and 60% of its total exports.

Forestry is a provincial jurisdiction under the Constitution. And that's a good thing, because the provinces are closer to the resources, and thus are in a better position to exercise that responsibility.

Contrary to a widespread myth, the Government of Canada has never gotten involved in the area of forestry development by encroaching on provincial jurisdiction. Its involvement has taken the form of joint programs. And experience showed that it was better not to renew those programs, because they generated confusion.

The federal government has thus made a commitment not to act in areas where provincial programs exist. It needs to retain only those responsibilities that are logical to do nationally, with respect to international trade and the environment.

On the research and development side, it is giving people and companies in all provinces access to a unique database and a world-renowned expertise, thus yielding substantial economies of scale, while avoiding overlap and duplication. No one who is properly informed is challenging those responsibilities, since a coordinated national effort is obviously needed in those areas.

Let me give you an example of the type of research the federal government is conducting in the forestry sector. While visiting a forestry centre in Quebec City, a researcher explained to me the problem of spruce bud moths, which are destroying our forests from Manitoba to New Brunswick. The spruce bud moths don't face any interprovincial trade barriers, and they probably haven't read the Constitution. I asked the researcher how many colleagues he had working on this problem, and he answered: "No more than about 20 researchers for all of Canada".

Those cutting-edge researchers need to talk to one another, to work together and consult one another, without having to go through a lot of red tape. It's very desirable for that critical mass to remain together, within a single system. The federal government thus has a clear role to play, which everyone can appreciate.

Fisheries

Of course, I can't come to British Columbia and not talk about fisheries. As you know, the Constitution gives the federal government jurisdiction over "sea coast and inland fisheries". It's the same for most federations.

In practice, however, the Government of Canada has delegated the better part of management to the provinces for inland fisheries where there are no complicating factors such as migratory species or ongoing international negotiations. Even the coastal provinces are involved in fishery management, playing an important role with regard to habitat and regulations on urban development and forestry practices. They also participate in an advisory capacity on numerous allocation and international advisory boards.

It obviously makes sense that the provinces play such an active role, considering how important fisheries and the processing industry are to local economies. However, a clarification of roles is required today because of emerging changes linked to the modernization of the fisheries such as increased capacity, environmental problems, and increasingly complex international relations.

That's why we've agreed with the Government of British Columbia to proceed with a bilateral review of federal and provincial roles and responsibilities in managing the Pacific salmon fishery, a resource that is crucial to this province. Mr. Mifflin and his colleague Mr. Evans are working to negotiate this new and promising initiative. I understand that even Premier Clark is now smiling, which is good news for the federal minister of intergovernmental affairs!

Conclusion

I've outlined how the Government of Canada plans to change our federation so as to improve services to citizens and inspire them to take on together, within a united Canada, the tremendous challenges of the 21st century.

We need your insight, as public administrators and specialists in public administration. Canada's future hinges on an objective assessment of reality, and on good decisions to improve that reality.

That is how we will ensure that our country continues to be one of the most admired in the world for the opportunities it gives its citizens.

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