Document Information

Date: 1969-06-12
By: Secretariat of the Conference
Citation: Constitutional Conference, First Working Session, Report of the Conclusions of the Meeting, Doc 149 (Ottawa: 11-12 June 1969).
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Document No. 149
June 12, 1969.

CONSTITUTIONAL CONFERENCE

FIRST WORKING SESSION

JUNE 11-12, 1969

REPORT OF THE CONCLUSIONS

OF THE MEETING

SCC

SECRETARIAT OF THE CONSTITUTIONAL CONFERENCE
SECRETARIAT DE LA CONFERENCE CONSTITUTIONNELLE

CONSTITUTIONAL CONFERENCE
FIRST WORKING SESSION
JUNE 11-12, 1969

Report on the Conclusions of the Meeting

The Prime Ministers and Premiers held their First
Working Session in Ottawa on June 11 and 12, 1969.

The agenda of the meeting was as follows:

1. Distribution of Powers in the Constitution:

a) The Taxing Powers
b) The Spending Powers

2. Constitutional Aspects of Regional Disparities
3. Progress Reports from Committees of Ministers
4. Programme of Work for the Constitutional Review
5. Other Business

Item 1 – General

In the consideration of this item, all governments
noted that the present discussions about the taxing and
spending powers were subject to a satisfactory division of
powers being developed. The government of Canada and
several provinces were concerned that any agreement on the
taxing and spending powers was subject to a distribution
of legislative powers which would ensure a strong central
government. Some provinces made the point that federalism
also meant strong provincial governments.

Agenda Item 1 a) –

With one exception, the First Ministers agreed that
Parliament and the provincial legislatures should generally
have access to all tax fields, the power of the Parliament
of Canada applying across the country and the power of
each provincial legislature applying within that
province. In applying this principle, the following
objectives were accepted:

(i) The “within the province” limitation of
provincial taxing powers should generally
be applied with respect both to direct and
indirect taxes, so as to protect the tax-
payer against the taxation of his income,
property or purchases by more than one
province.

(ii) The taxing powers of both Parliament and
the provincial legislatures should be limited
so as to avoid the erection of “tax barriers”
to interprovincial trade, and the power to
impose customs duties should continue to
be confined to Parliament alone.

(iii) Considering that both Parliament and the
provincial legislatures would have access
in general to the same sources of tax revenue,
there should be more regular and adequate
federal-provincial consultations.

It was recognized that the principle of general
access to all tax fields would not enable all provincial
governments equally to discharge their constitutional
responsibilities, and therefore Parliament should have
the explicit power to make equalization grants to
provincial governments. One province advocated that,
instead of equalization grants to governments, there be
established a basic income for all Canadians.

While some differences of views were expressed
the First Ministers agreed that the Continuing Committee
of federal and provincial officials be instructed to
consider further how these principles, if formally
accepted, might be applied in a revised constitution and,
in particular, to consider the alternative method of their
application to the taxation of estates, transactions and
real property. Certain provinces expressed the view that
death duties and real property taxes should be excepted
from the principle of access.

The Conference recognized that the discussions
on the use by Parliament and the legislatures of their
taxing powers should proceed concurrently with the consti-
tutional discussions, and that such discussions would be
of continuing importance in relation to the discharge by
governments of their constitutional responsibilities.

Agenda Item 1 b) –

The second major item of discussion concerned
the exercise of the spending power of the Parliament of
Canada. Most delegations agreed that the present power
of Parliament to make payments to individuals or to
institutions should not be subjected to any constitutional
limitation; one province, however, reserved its position
until the question of the distribution of powers had been
dealt with, while some other provinces expressed the view
that this federal power should in practice be exercised in
consultation with the provinces. It was also noted that
some differentiation of institutions might be required
before this principle could be finally accepted.

There was general agreement that there should be
no constitutional restriction on the power of the Parliament
of Canada to make unconditional grants to provincial govern-
ments; one province, however, expressed the view that the
establishment of a negative income tax plan, administered
by the Government of Canada, would make such payments unne-
cessary.

It was generally agreed that the Parliament of
Canada should continue to have the power to make conditional
grants to provincial governments, provided there is a satis-
factory formula for determining a national consensus in
favour of particular programmes, and provided there is a
satisfactory formula for compensation in non-participating
provinces.

With respect to the formula for determining the
consensus there was agreement that the Parliament of
Canada and the provincial legislatures would be the appro-
priate bodies to determine whether a consensus exists, and
there was general agreement that the formula should reflect
the regional character of the country. However, one province
stated that while it agreed with the principle of estab-
lishing a consensus, it considered that the formula for
amending the constitution might well provide the basis for
reaching consensus. It was further agreed that the Continu-
ing Committee of Officials should look again at alternative
formulae.

There was general agreement that there should be
no fiscal penalty upon the people of the non-participating
provinces and that the ways of achieving this would be
discussed at future meetings.

Agenda Item 2 –

The First Ministers agreed that the objective
of reducing disparities across the country should be
written into the preamble of a revised constitution as a
basic goal of the Canadian people. Some provinces argued
further that the Constitution should impose on the Federal
Government a specific obligation to alleviate disparities.
First Ministers agreed that at future discussions on the
division of powers, it will be important to ensure that
the federal and the provincial governments have appropriate
powers to work toward this objective.

Agenda Item 3 –

The Working Session was advised of the progress
which had been made by Committee of Ministers on the
following matters:

Official Languages
Fundamental Rights
The Judiciary
The Senate

The First Ministers took note of the progress to date and
agreed that all the Committees should endeavour to meet
again and report further to the Constitutional Conference
before its next meeting.

Agenda Item 4 –

The Prime Ministers and Premiers agreed to meet
again before the end of the year.