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Medicare, Meech Lake, and the Federal Spending Power

Published online by Cambridge University Press:  18 July 2014

Paul Barker
Paul Barker
Affiliation:
Brescia College, University of Western Ontario
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Extract

In the spring of 1987, Canada's first ministers agreed to a package of proposals for reforming major elements of the country's constitution. The package, which has come to be known as the Meech Lake Accord, contains a number of significant provisions, one of which deals with the federal spending power and national shared-cost programs. This provision stipulates that the federal government must compensate provinces that decline to participate in future national sharedcost programs, but immediately adds that such compensation is conditional upon the non-participating provinces establishing “a program or initiative that is compatible with the national objectives.”

The provision has led to a great deal of debate and discussion. Of special interest, and concern for some, has been the possible effect of the provision on the capacity of the federal government to use its spending power to set up national shared-cost programs. Some contend that Ottawa's capacity would be severely restricted or even eliminated by the provision. Others claim that it would have little or no impact, that the Accord would simply constitutionalize present practices. These conflicting views on the implications of the Meech Lake Accord for shared-cost programs doubtless flow from many sources, but a major one appears to be differing views on the present ability of Ottawa to establish these types of arrangements.

Type
Comments/Commentaires
Information
Canadian Journal of Law and Society / La Revue Canadienne Droit et Société , Volume 5 , 1990 , pp. 111 - 126
Copyright
Copyright © Canadian Law and Society Association 1990

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References

Notes

1. Constitution Amendment, 1987, section 7 (section 106A of the Constitution Act, 1867).

2. Hogg, Peter, Constitutional Law of Canada (2nd ed.; Toronto: Carswell, 1985), 124Google Scholar; Magnet, Joseph, “The Constitutional Distribution of Taxation Powers,” Ottawa Law Review 10 (1978). no. 3, 480Google Scholar; Trudeau, Pierre, Federal-Provincial Grants and the Spending Power of Parliament (Ottawa: Queen's Printer, 1969), 12Google Scholar; Attorney General of Canada v. Attorney General of Ontario (Employment and Social Insurance Act Reference), (1937) A.C. 355; Angers v. MNR (1957) Ex. C.R. 83; Central Mortgage and Housing Corporation v. Co-op College Residences (1975) 13 O.R. (2d) 394 (Ont. C.A.); Winterhaven Stables Ltd. v. Attorney General of Canada (1986) 29 D.L.R. (4th) 394. Those with different views include Scott, F.R., “The Constitutional Background of the Tax Agreements,” in Scott, F.R., Essays on the Constitution (Toronto: University of Toronto Press, 1977)Google Scholar; Drieger, E.A., “The Spending Power,” Queen's Law Review 7 (Fall 1981), no. 1, 12Google Scholar. Scott contends that the power flows from the Crown prerogative, while Drieger says that the source of the power is to be found in s. 106 of the Constitution Act, 1867.

3. See the first three sources and the cases listed in the preceding note. Others claim that the federal government may use the spending power to make only unconditional payments to other governments, while still others say that the power can be used only for matters under federal jurisdiction. For a discussion of the varying interpretations of the federal spending power, see Hogg, , Constitutional Law of Canada, 123–126Google Scholar.

4. For more on the limitations, see Smiley, Donald V., Canada in Question: Federalism in the Eighties (3rd ed.; Toronto: McGraw-Hill Ryerson, 1980), 23–24Google Scholar.

5. For more on this development and on shared-cost programs generally, see Maslove, Allan and Rubashewsky, Bohodor, “Cooperation and Confrontation: The Challenge of Fiscal Federalism,” in Prince, Michael J. (ed.), How Ottawa Spends: 1986-87: Tracking the Tories (Toronto: Methuen, 1986)Google Scholar; Bastien, Richard, Federalism and Decentralization: Where Do We Stand? (Ottawa: Government of Canada, 1981)Google Scholar; and Barker, Paul, “The Development of the Major Shared-Cost Programs in Canada,” in Olling, R. and Westmacott, M.W. (eds.), Perspectives on Canadian Federalism (Scarborough: Prentice-Hall, 1988)Google Scholar.

6. It should be noted that some shared-cost programs are national in scope and are meant to be applied to all provinces while others are established to address the needs of a limited number of provinces. The Meech Lake Accord appears to be only in relation to national shared-cost programs.

7. For more on these attempts, see Maslove and Rubashewsky, “Cooperation and Confrontation”; Bastien, Federalism and Decentralization; Barker, “The Development of the Major Shared-Cost Programs in Canada”; Trudeau, Federal-Provincial Grants and the Spending Power of Parliament and “Draft Proposal Discussed by First Ministers--Spending Power,” Federal-Provincial Conference of First Ministers on the Constitution, List of “Best Efforts” Draft Proposals, Ottawa, February 5-6, 1979.

8. Constitutional Amendment, 1987, section 7.

9. Johnson, Al, “Weakened Bonds of Nationhood,” Policy Options 9 (January 1988), no. 1Google Scholar.

10. Canada, Senate and House of Commons, Minutes of Proceedings and Evidence of the Special Joint Committee of the Senate and House of Commons on the 1987 Constitutional Accord, 11-8-87, 5:72 (Ottawa: Queen's Printer, 1987) (witness is Richard Simeon)Google Scholar.

11. Dupré, J. Stefan, “Section 106A and Federal-Provincial Fiscal Relations,” in Swinton, Katherine E. and Rogerson, Carol J. (eds.), Competing Constitutional Visions: The Meech Lake Accord (Toronto: Carswell, 1988), 206Google Scholar.

12. Coyne, Deborah, “The Meech Lake Accord and the Spending Power Proposals,” CAUT Bulletin ACPU (January 1988), 9 and 5Google Scholar.

13. Norquay, Geoff, “Social Spending After Meech Lake,” Policy Options 8 (October 1987), no. 8, 12Google Scholar. See also the comments of Richard Simeon as witness in the Minutes of Proceedings and Evidence of the Special Joint Committee of the Senate and House of Commons on the 1987 Constitutional Accord.

14. Canada, Department of Finance, Established Programs Financing--Advanced Calculation, 1989-90 (Ottawa: Federal-Provincial Relations Division, Department of Finance, April 12, 1989)Google Scholar.

15. Canada Health Act, S.C. 1983–1984, C.6.

16. Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act, S.C. 1976-77, C.10; 1984, C.13.

17. Unless otherwise noted, the following discussion is based on information found in the annual reports of Health and Welfare Canada, Canada Health Act (Ottawa: Supply and Services)Google Scholar and confidential discussions with officials of Health and Welfare Canada.

18. For more on this important issue, see Globe and Mail, February 14, 1989, A1–A2; Globe and Mail, February 20, 1989, A20.

19. Heiber, S. and Deber, R., “Banning Extra-Billing in Canada: Just What the Doctor Didn't Order,” Canadian Public Policy 13 (March 1987), no. 1CrossRefGoogle Scholar.

20. This last statement should be qualified to respect the fact that one province, New Brunswick, allows doctors to leave the plan for services for which they wish to charge extra and to remain in the plan for services for which they accept the government fee.

21. Hansard, Official Report of Debates, Legislative Assembly of Ontario, Select Committee on Constitutional Reform, 1987 Constitutional Accord, Proceedings, February 24, 1988, C439 (witness is Deborah Coyne).

22. See, for example, Vayda, Eugene and Mindell, William, “Variations in Operative Rates: What Do They Mean?” Surgical Clinics of North America 62 (August 1982), no. 4CrossRefGoogle ScholarPubMed.

23. It is important to recognize that the indicator deals with medical and hospital care. Provincial health plans offer services in addition to these types of care, but the federal-provincial arrangement for medicare is only in relation to hospital and medical care (and a few dental services).

24. Statistics Canada, Provincial Government Finance: Revenues and Expenditures, 1984 68–207 (Ottawa: Minister of Supply and Services, January 1988)Google Scholar.

25. Health and Welfare Canada, National Expenditures in Canada 1975-1985 (Ottawa: Minister of Supply and Services, 1987)Google Scholar.

26. This observation brings to mind another point which should be considered, namely that the whole debate about shared-cost programs tends to assume that the relevant inputs are solely a function of the arrangements. However, it seems reasonable to argue that the character of the programs across the country also reflect other variables. One implication of this is the spending power provision may have only a small impact on social programs.

27. This capacity of regional governments to thwart the central government is a point long appreciated by students of fiscal federalism in both the United States and Canada. See, for example, Smiley, Donald V., Conditional Grants and Canadian Federalism: A Study in Constitutional Adaptation (Toronto: Canadian Tax Foundation, 1963), 29 and 42–43Google Scholar.

28. Hogg, Peter, “Analysis of the New Spending Provision (Section 106A),” in Swinton, and Rogerson, (eds.), Competing Constitutional Visions, 159–160Google Scholar.

29. Here, it might be relevant to note the words of Pierre Trudeau, uttered years before he became a strong opponent of Lake, Meech: “[I]t almost seems that whenever an important segment of the population needs something badly enough, it is eventually given them by one level of government or the other, regardless of the constitution.” Quoted in Smiley, Conditional Grants and Canadian Federalism, 27Google Scholar.