Report of the Western Premiers’ Task Force on Constitutional Trends, 3rd Report

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Western Premiers’
Task Force on

Constitutional Trends

Third Report

March 1979

Province Of Ministry Of Parliament Buildings
British Columbia Environment V”_3‘_°”a _
British Columbia
V8V 1X4

March 26, 1979

The Honourable W. R. Bennett
Premier, British Columbia
Parliament Buildings

Victoria, B.C.

Dear Mr. Premier:

As Chairman of the Western Premiers’ Task Force on Constitutional Trends,
I take pleasure in forwarding herewith, for consideration by the Western Premiers at their
meeting in Prince George, British Columbia, the Third Report of the Task Force.

As has been the case with the First and Second Reports, it is felt that the
identification of intrusions and the consultative processes that have resulted have contributed
to a heightened awareness and sensitivity to the concerns expressed. It is to be
noted, however, that there is much more to be done to prevent and to resolve the kind of
intrusions identified by the work of the Task Force to date.

It is respectfully recommended that the Task Force be instructed to continue its work.

Yours very truly,


Task F orce on Constitutional

Part I
Part II
Part III
Part IV

Part V

Part VI


Current Trends

p Task Force History

Status Report
Duplication of Services

Communique’ and Letter of
Transmittal to Prime Minister

VI A :3
c3\ .1; O\ ii-I\_3 5 K03

Part I Current Trends

Events of recent years-—-the proliferation of federal

and provincial programs and services; a perceived
insensitivity on the federal government’s part to provincial
priorities and jurisdiction; a growing tendency by

the federal government to initiate legislation in subject
areas which traditionally and constitutionally have

been considered to be within the spheres of provincial
jurisdiction;,and the emergence of a new sense of identity
and destiny in the West—-—provided the impetus for

an assessment by the Western Premiers of relations

between the federal government and the western provinces.

In April 1976 the Western Premiers, therefore established
a Task Force on Constitutional Trends to identify,

to undertake an analysis of, and to monitor federal
government legislative thrusts in certain subject areas.

The Task Force has issued two previous reports

(May 1977 and April 1978) which outline its findings
and its attempts to address the problems. (Details of
these activities are outlined in Part II of this Report
entitled “Task Force History.”) ’

The issues of concern to the western provinces range
from potential irritants to unnecessary duplications to
constitutional intrusions. Common themes throughout-
the reports are that there has been a lack of meaningful
consultation and that federal initiatives have either
resulted in unnecessary duplication or often placed
restraints on the ability of the provinces to exercise” their
constitutional responsibilities.

After the release of the First Report in 1977,

follow-up discussions were held with federal officials

on the status of specific issues. In addition, the possible
establishment of a mechanism to lessen federal-provincial
friction, duplication and constitutional intrusions

in the future was considered.

In the Second Report (April 1978) the Western
Premiers noted the heightened awareness and sensitivity
to western provincial concerns on the part of the federal
government which had resulted from the release of

the First Report and the follow-up process to it. It was
hoped that the Second Report would augment the
momentum toward a successful resolution of ,
federal-provincial tensions. They also agreed that
federal-provincial mechanisms were essential to reduce
or to deal with such intrusions in the future and

they instructed the Task Force to give particular attention
to this matter.

During the past year a number of discussions have
been held with the federal government on the status of
the issues raised by the western provinces. As outlined in

the body of this Report the western provinces
acknowledge that, in the eight areas examined, close

to half of the concerns raised could be considered
substantially resolved or at least modified. The retmjiirtcler
of the issues raised require further consultation or are
considered to be based on fundamental differences

in federal and provincial policy objectives.

The Task Force realizes that other activities recently
undertaken by federal and provincial governments have
coincided with its efforts. For example, many items
being examined by the Task Force are also being
considered in the context of the constitutional review
process, the preparatory and follow-up work related to the
First Ministers’ discussions on the economy, and in

the federal-provincial exercise to reduce duplication of
government services.

Pursuant to the instructions of the Western Premiers

in April 197 8, the concept of afedera1—western
consultative mechanism, which would forestall the
development of federal-provincial problems and resolve
conflicts when they do arise, has been further explored.
The Task Force deals with this subject in Part IV

of the Report entitled “Mechanisms.”

In summary, during the past year, there continued

to be instances where the federal government failed to
take into account provincial concerns and input in

areas affecting both orders of government. Inadequate
federal-provincial consultation prior to the introduction
of the federal spending cuts affecting federal-provincial
programs is one example of such federal actions.

More serious however, was the introduction of the
Energy Supplies Emergency Act, I 979 without any prior
consultation, notwithstanding the fact that the question

1 of jurisdiction overresources ‘is such a sensitive

federal-provincial issue, and that the predecessor of

the present Act had been identified in the Task Force’s
reports as being of serious concern to the western
provinces. Despite these actions, however, it is the

View of the Western Premiers’ Task Force- that the process
initiated by the publication of the reports of the

Task Force has had some positive results in sensitizing
the federal government to legitimate provincial concerns.
While it is unreasonable to expect that there will not

be any disagreements betweenthe federal and the westerit
provincial governments in the future, it is suggested
thatthe processes which the Task Force have put

in motion, including the proposed consultative
mechanisms, will result in a greater understanding
between governments, and respect for each other’s
legitimate legislative jurisdiction.

Part II Task Force History’

1. Background

The Western Premiers at their Annual Conference

held in Medicine Hat on April 28, 1976, expressed their
concern over the increasing tendency of the Government of
Canada to legislate in subject areas which historically
and constitutionally had been considered to be within the
provincial sphere. Accordingly the Western Premiers
established an intergovernmental Task Force of
Ministers, chaired by British Columbia, to prepare a
detailed inventory of these apparent intrusions and to
make recommendations to the next Western Premiers’

2. The Task Force

The present members of the Task Force are the
Honourable K. Rafe Mair, Minister of Environment,
British Columbia, Chairman; the Honourable Dick

‘ Johnston, Alberta Minister of Federal and Inter-

governmental Affairs; the Honourable Roy Romanow,

Saskatchewan Attorney-General; and the Honourable

G. W. J. Mercier, Q.C., Manitoba Attorney-General.

3′. Methodology

A meeting of all representatives was held in Victoria
in May 1976. At that meeting, it was agreed that
Task Force officials would develop and administer a
common questionnaire to be given to the appropriate
Ministries in each of the four provinces. Provincial
interests to be canvassed fell into eight broad
categories: .
1. Consumer and Corporate Affairs.


Housing and Urban Development.

Economic Development.

Communications. .
Immigration, Manpower, and Labour.
Administration of Justice.

Interventions by the Government of Canada before
the Supreme Court of Canada.


It is to be noted that concerns pertaining to Finance,
Human Resources, Education, and Health were not
considered by the Task F orce.

The results of the questionnaire were analysed and

Task Force officials worked through the fall of 1976 and
the winter of 1977 preparing position papers on each
subject area. By April 1977, Task Force officials felt
that the position papers, while not having the unanimous


support of all four provinces on every point raised,
had been refined to the extent that they fairly represented
a “Western Task Force Position.”

4. First Report of the Western Premiers’ Task
Force on Constitutional Trends, May 1977

At their meeting held at Brandon, Manitoba on May 5
and 6, 1977, the Western Premiers received the Report and
issued a communique which read in part:

The Premiers have today received and considered
the Report which reflects a high degree of consensus
among all four governments.

The Premiers expressed the hope that the Task Force
Report would contribute toward a lessening of
federal-provincial tensions in areas wherekin the
provinces’ view, recent actions by the federal
government had created, or were likely to create
undesirable friction . . . .

In releasing the Report, the Premiers were of the View
that it would contribute to a more informed
understanding of some very important aspects of
federal-provincial responsibilities. Each of the areas
canvassed involved sensitive and rather complex
questions of public policy. There is a need for the
provincial and federal governments to be aware

of and sensitive to each other’s priorities. The
Premiers noted that too often in these areas federal
initiatives have either been unilateral or unappreciative
of legitimate provincial jurisdiction and interests.

The Report is being sent to the Prime Minister and
the other provincial Premiers, on the basis that

a constructive federal-provincial dialogue on these
matters can take place.

Premier William R. Bennett of British Columbia in his
letter to the Prime Minister of May 5, 1977, forwarding
the First Report of the Western Premiers’ Task
Force on Constitutional Trends stated that:
It was agreed that the Report should be forwarded
to you, in the hope that it might make a positive

contribution toward a reduction of some current
federal-provincial tensions.

We would hope that the Report will receive your
careful consideration. The Task Force will continue
as an ongoing mechanism, to facilitate follow-up
discussions with federal oflicials. . .

In his letter of reply to Premier Bennett of May 30,
1977, the Prime Minister expressed the hope that

the Report would make a positive contribution toward
better federal-provincial relations and indicated

that he had instructed officials in the Federal-Provincial
Relations Office to prepare an analysis and evaluation of
the issues raised by the Task Force Report.

In July of 1977 federal and provincial officials

met in Vancouver to map out a course of action that
would address the issues outlined in the Report.

It was agreed that federal officials would make available
to the western provinces their analysis of the Report

and that provincial oflicials would then have an
opportunity to analyse the federal responses in preparation
for a further meeting of federal and provincial officials .
at which each subject would be discussed individually. It
was also agreed that discussion of a mechanism that
might be developed to lessen the possibility of intrusions
in the future would be undertaken at that subsequent

Federal responses were forwarded to the provinces

over the course of five months from August to December

of 1977 and a meeting of western provincial oflicials
was held in Vancouver in December 1977 to discuss the
provinces’ analysis of the federal responses.

A meeting of federal and provincial representatives

next took place in February 1978 at_which each of the
issues raised in the Task Force Report was discussed and
categorized under an appropriate heading indicating

the agreed upon status of the matter to date. Provincial
officials mentioned nine new problem areas which

had come to light since the First Task Force Report was
prepared and these were noted by federal representatives.
The meeting concluded with a brief discussion of
meaningful mechanisms designed to head off future
constitutional intrusions, duplication and federal-
provincial friction.

5. Second Report of the Western Premiers’ Task
Force on Constitutional Trends, April 1978

In March 1978 the Task Force Ministers met to

review the findings of provincial officials inpreparation
for presentation of the Second Report of the Western
Premiers’ Task Force on Constitutional Trends

to the Western Premiers at their April Conference.

The Western Premiers received and considered the Second
Report of the Task Force at their April 13-14

Conference at Yorkton, Saskatchewan. The Second
Report contained a progress report on developments that
had taken place since the release of the First Report

along with details of new problems that had been
identified during the year. ‘

The Second Report also contained a proposal for a
mechanism to lessen such federal-provincial irritants
and intrusions in the future.

The communique issued at Yorkton on April is-ls,

1978, stated in part that:

The Western Premiers expressed the hope that, jiisi.

as the First Report and the follow-up process it
generated has contributed to a heightened aWtll’(2l’lt3l§:St
and sensitivity to the concerns it expressed, the Set:t)’m.l
Report would maintain that process and augment the
momentum toward a resolution of certain cuIfremI:
federal-provincial tensions. The Western Pt‘(‘}lTtlcl‘5i
agreed that a federal-provincial mechanism is esscI1l.l:Il
and have instructed the Task Force to give paI*tic:1.Ii:Ir
attention to this matter in the near future.

In his letter of April 14, 1978, forwarding the
Second Report to the Prime Minister, Premier William R.
Bennett of British Columbia stated that:

Obviously there is much more to be done to prevent

and to resolve these kinds of concerns. The Western
Premiers would hope that continuing efforts can be made
by our governments to address the specific concerns-
identified to date and also to consider further what
mechanisms might be put in place to prevent or lessen such
intrusions in the future.

6. Third Report of the Western Premiers’
Task Force ‘

On June 6, 1978, Task Force Ministers met with the
Minister of State for Federal-Provincial Relations

to discuss the Second Report and the draft “Possible
Consultative Mechanisms With The Western Provinces To
Improve Federal-Provincial Relations” that it

contained (see Part IV). Federal responses to the

nine new subjects identified in the Second Report were
given to the (Provinces. These were analysed in the
months that followed a11d synthesized provincial
comments were then forwarded to federal officials.

Federal and provincial representatives met in Ottawa
on February 27, 1979, and discussed mechanisms
designed to prevent future federal-provincial problems
and to resolve problems once they have occurred.
They also reviewed the current status of the problems
identified by the Task Force in the previous reports.
The current status of those items, as perceived by
provincial representatives, is set out in Part III of this

In View of the Western Premiers emphasis on the
development of a satisfactory mechanism to head off
future federal-provincial conflict, in this the Third Report
of the Western Premiers’ Task F orce on Constitutiozml
Trends the Task Force explores (in Part IV) the
different proposals that have been put forward to dzltt:
by the federal and provincial governments in the

hope that their work might contribute to the early
establishment of an appropriate method to/prevent or
significantly lessen federal—provincial conflic.t in Ilie
long term. ‘

Part III Status Report

This part is a report on the present status, as perceived
by provincial representatives, of each of the items

of concern to the western provinces identified in the

First Report along with those items that were identified in
the Second Report. The left hand column contains
summaries of the comments and recommendations of the
Task Force while the right hand column contains a

brief update on developments since the matter was




I Consumer and Corporate Affairs

R The Task Force expressed concern that proposed

federal intrusions in the area of consumer and corporate
affairs appeared to be a significant attempt to regulate
most features of the credit-payment-financial institution
system. They agreed that these national policies

were often insensitive to provincial jurisdiction and
priorities. The Task Force felt that although there was
some merit to these federal proposals several concerns
remained and they asked that a reassessment of
federal-provincial relations in this area be made before
these federal proposals are proceeded with.

1. The Borrower’s and Depositofs Protection Act
(Fair Credit and Lending Act)

The Task Force expressed concern that this legislation
could lead to a considerable dislocation of_provincial
mortgage legislation, trade practices, and

consumer credit legislation. A national regulatory
presence for all financial institutions (including

retail credit grantors), provincial credit unions, and
provincial treasury branches would also be established.
As such, conflicting federal and provincial legislation
will exist and there is a strong possibility that
constitutional litigation will occur. The Task Force
suggested that the whole question be reassessed

in light of these realities, and that provincial
representations requesting that no action be taken
without further federal-provincial consultation should
be submitted.

2. Competition Policy

This bill will establish a National Markets Board to
deal with numerous aspects of corporate market
conduct. Provincial and local priorities could easily
be disregarded in this comprehensive federal regulatory
system. The Task Force expressed concern about
the constitutionality of this policy. They suggested
that the possibility of challenging this legis1ation’s
constitutionality should be explored by the provinces.
Provincial and regional development should also

be recognized as a factor in arriving at national
policy decisions.

Although there has been continued effort made by tile
federal government to address provincial concerns the
provinces are concerned that this area still has the greatest
potential for subtle federal intrusions into areas within the
provincial sphere. ‘

The federal government appears to have withdrawn its
interest in proceeding with this omnibus legislation,

for the time being, and it is now anticipated that some of
the proposals contained in the bill will be adopted through
amendments to existing federal legislation. To the

extent that the federal government is unlikely to proceed
with aspects of the proposed legislation provincial
concern in this area is allayed.

The western provinces agreed that continued consultation
via the Federal-Provincial Task Force on Consumer
Credit is necessary to ensure resolution of provincial

The federal government has not as yet reintroduced

the bill dealing with Phase II revisions of its Competition
Policy. The last version that was presented did

respond to some provincial concerns such as giving
Provincial Attorneys—General the right to appear before
the Competition Board and clearly excluding

provincial marketing boards from the legislation.

The western provinces however continue to be concerned
that this national policy can be strongly biased against
the economic interests of particular regions and question
the constitutionality of the policy.

The Task Force agreed that no further action was
warranted on this matter at this time but that as soon as
the federal government reintroduces the bill close
consultation will be necessary‘ and include the addressing
of the constitutional issue at the First Ministers level.






Bank Act 1977

The Task Force noted that the federal Bank Act, _
which requires membership in the Canadian Payments
Association, would in fact govern the activities

of all financial institutions in Canada, regardless of
jurisdictional origin. As such, the Bank Act carries
complicated implications for the provinces. A wide
range of objections to this Act were presented

in the interprovincial brief of December 1976. The
Task Force suggested follow-up to determine R
the adequacy of the federal response to provincial

Electronic Payments Systems

These proposals would establish a centralized
electronic clearing mechanism for deposit-taking
institutions. This system is of immediate concern to
the provinces considering the impact it could

have on communications systems, debtor-creditor
relations, consumer credit, human rights and privacy,
contracts and jurisdiction over provincial financial
institutions. In light of provincial interest in
continuing recent federal-provincial consultation

on this matter, the Task Force recommended that
better liaison between the two levels of government
he sought.


. Trade Practices

Concern was expressed that the federal government
intends to develop its own T rade Practices Act,
notwithstanding the presence of existing and proposed
provincial legislation. As such, federal actions

in this regard would create conflicting legislation and
cause confusion for businesses and consumers.

The Provinces of British Columbia, Alberta, and
Saskatchewan asked the federal government to refrain
from legislating in this area.

A number of points made by the provinces have had some
impact on the Canadian Payments Association proposal
which is now less of a problem to provincially chartered
financial institutions; however, the provinces continue

to be very concerned about the future of Credit

Unions. The proposal to allow banks to go into leasing,
factoring, and certain data processing fields will make

it impossible for near-banks and others to compete and
increase the domination of chartered banks. To

allay the uncertainty of where Bank Act jurisdiction ends
and provincial laws of general application begin the
provinces would like to see a recognition in the Bank. Act
of the applicability of provincial personal property,
security, credit information and trade practices legislation.
There is also a desire to see the present limitation

on bank holdings of non-NHA residential mortgages
maintained in order to provide continued protection to
other institutions. ”

Further consultation is under way on the Bank Act
regulations, in the meantime the provinces await the
federal government’s response to their most recently
expressed concerns.

It appears. that the impasse in federal-provincial
discussions of Electronic Payments Systems has still not
been resolved. Ottawa still insists that the provinces
have no role outside of “Consumer and Legislative
Issues.” The provinces wish to be involved in the
“hardware and software” issues and would like to be more
directly involved in the studies that are being conducted.
A further concern is that the development of the
Electronic Payments Systems should not be left to the
privately controlled Canadian Payments Association.
Specific legislation drafted after consultation with the
provinces and the private sector should set out basic
policies concerning universal access to the payment card
system. i

It was agreed that further and improved consultation
is necessary here.

The Provinces have continued to make it clear that
there is no obvious need for new federal legislation in
this area and believe that the federal government

has accepted that view.

This subject requires continued monitoring as the
proposals may be revived.




6. Bankruptcy Act

These proposals would create a broader base for ‘
federal involvement in debtor assistance programs
which might erode or eliminate existing provincial
programs. The Task Force suggested that firm
assurances should be obtained from the federal
government that provincial exemptions legislation will
be recognized in respect of the Act’s treatment

of consumer debtors. Provinces wishing to operate
or institute debtor counselling assistance programs
should be delegated the necessary powers and

should receive reasonable financial assistance for such

7. Proposed Mutual Funds Act and Securities Act

Considering that provincial programs in these

two areas have been operating effectively for some

time the proposed federal legislation would create
duplicative and conflicting regulations. A good case
for this separate or additional level of federal
regulations under either heading has not been made.
The Task Force felt that there should be a reassessment
of the proposed legislation in light of these concerns.

II Resources

The Task Force agreed that some of the most contentious
issues in federal-provincial relations in recent years

have been centred around the natural resource sector.
Various federal initiatives, especially since 1973,

have resulted in increased tensions between the federal
government and the provinces, and in some cases have
severely restricted the freedom of provincial governments
to exercise their responsibilities over the management

of renewable and nonrenewable resources.

Federal-provincial discussions have now led to

agreement on the provisions of the Bankruptcy Act and
the federal government has indicated a willingness

to consult the provinces on details of the administration of
Part III of the new bill respecting consumer debtors
should the bill become law.

It has been concluded that the previous difficulties
with this matter have been resolved.

Provincial concerns remain the same and publication
of “Proposals for Securities Market Law for Canada”,
is still being awaited. Following that, provincial
concerns may be exacerbated or not, depending on how
the federal government proposes to move.

It is to be noted that this matter could be the subject of
future constitutional review discussions.

The western provinces reiterate their concerns that the
federal government is encroaching upon their
constitutional responsibilities for the ownership and
management of natural resources. They reaffirm

the principle unanimously agreed to by the 10 provincial
Premiers in October 1976, which called for “a
strengthening of jurisdiction of provincial governments of
taxation in the areas of primary production from lands,
mines, minerals and forests”. The provinces still
maintain that the Constitution should be amended to
allow the provinces to levy indirect taxes on resources to
“guarantee the provinces’ effective control of their
resources.” I

The western provinces’ concerns that provincial
ownership and control of natural resources needed to

be strengthened have been heightened by two d€CiSl(‘)t1S
handed down by the Supreme Court of Canada,

namely, Canadian Industrial Gas and Oil I_.imited vs.

the Government of Saskatchewan et al (the CliCiC)li..
decision) in November 1977, and Central Cfariacla Pi,Ff(il.i’/I
Company Limited vs. the Government of SCl.S’lCtl’l(Tll¢?fH.!ll’ll
et al (the Canada Potash decision) in October 1978.
They note that the issue of the control, Iiiziisizngcxitieitil




Renewable Resources

National Forestry Po-licy—T he Task Force
acknowledged a need for national uniformity of
forestry statistics and standards and recognized the
importance of assessing the resource’s financial
benefits. But, because of the vagueness of the federal
proposals and in view of possible jurisdictional
problems, they felt that the objectives of the program
should be more clearly outlined, perhaps via

CCREM (Canadian Council of Resource and
Environmental Ministers), in order that legitimate

areas for federal involvement could be closely defined.

2. N onrenewable Resources


(a) Nondeductibility of oil and gas royalties—T he
Provinces of British Columbia, Alberta, and
Saskatchewan maintained that this provision was
a serious challenge to the fundamental rights
of the provinces to control and benefit from
the development of the resources they own.
Their reasoning stemmed from the effect
the tax measure would haveon a provin_ce’s
ability to tax its resources; the effects these tax .
measures would have on the petroleum industry,
i.e., discouraging oil exploration activity
and thus Canada’s energy supplies; and the
effects the policy would have on a provincial
government’s attempts to diversify economically.

and taxation of natural resources in relation to the
control and regulation of interprovincial and international
trade has been a subject of extensive and lengthy 4
discussions during the recent round of federal-provincial
constitutional meetings. The issue remains unresolved
and likely will be the subject of further constitutional
discussions. 8

The western provinces note that their concerns with

regard to a National Forestry Policy seemed to have been
resolved and that discussions are continuing in this
respect under the auspices of the Canadian Council of
Resource and Environmental Ministers (CCREM).

The western provinces express concern, however,

at the lack of action on many of the commitments made
at the First Ministers’ Conference, on the Economy,
February 1978. They are particularly concerned with
respect to research and development funding where
federal programs in this area were severely curtailed by
federal spending reductions. They suggest that

follow-up on forestry issues should have been discussed at
the recent First Ministers’ Conference on the Economy,

. November 1978. They note that the federal government

has recently announced a national development .
policy of assistance to the forest products industry under
which federal-provincial agreements are to be developed
to deal with the specific requirements of each region.
The western provinces are currently assessing this
policy to determine its effect on provincial forestry
management goals and look forward to further federal-
provincial consultations in this regard.

The western provinces continue to regardthese

actions by the federal government as representing a
serious challenge to the fundamental rights of the
provinces to control and benefit from the development
of their resources. They note that the review of taxation
policies in the petroleum and mineral industries

called for by the First Ministers at their Conference on
the Economy, February 1978, has been completed

and was tabled at the First Ministers’ Conference on the
Economy, November 1978. The western provinces
acknowledge that the preparation of this report had
provided an opportunity to explore the question

of nondeductibility of provincial royalties in the mineral
resource sector. The western provinces note, however,
that this issue continues to be one where a basic

policy disagreement exists between the federal and
provincial governments regarding both the petroleum and
mineral industries.



(b) Petroleum Administration Act—-‘—The Provinces



of British Columbia, Alberta/and Saskatchewan
expressed reservations about Part 3 of the
Petroleum Administration Act as it amounts to
an assertion by the federal “government to
regulate prices, the flow, the production, and
the sale of a provincial natural resource.

Ten-cent excise tax on gasoline-———The federal
government’s 1_0—cent excise tax on gasoline,
which was levied to help finance the oil
import compensation program, represents
another type of federal intrusion in that it
restricts the province’s own ability to tax this
nonrenewable resource.

National Energy Board Act——The National
Energy Board Act can be seen as challenging the
basic principles of provincial resource ownership
and management. ‘This Act allows the

federal government to exercise control of exports
(volume and price) of crude oil, natural gas,

and related hydrocarbon by-products. Changes
in the National Energy Board regulations

. have been made without provincial input, even


though they have had a great impact on the
provinces’ and industry’s revenues. As such,
the provinces of British Columbia, Alberta and
Saskatchewan suggested that increased federal-
provincial consultation in these complex
jurisdictional matters would help to eliminate
some of the existing tensions relating to energy
matters. ’

Emergency Supply Allocation Act——Western
Canada’s surplus productive capacity would be of
paramount importance in meeting a shortage

of supply of crude oil in an emergency. The
Task Force felt that there was a lack of

provincial representation and input on the
Technical Advisory Committee to be set up under
this Act. As the owner of the resource, the
provinces should be involved in supplying
information and in a co—ordinating role.

The western provinces consider that their original concerns
with regard to Part 3 of the Petroleum Administration

Act are still valid even though that section of the Act

has not been proclaimed. They suggest that this
legislation is unnecessary since a federal-provincial

pricing agreement was reached before the legislation was
introduced. The provinces’ consider that differences

in attitudes are an important problem with regard to

this issue.

The wesetrn provinces reaffirm their basic concern

with the 10-cent excise tax on gasoline and acknowledge
that the federal government has reduced the excise

tax by 3 cents per gallon. The provinces suggest that the
amount of this tax should be decreased progressively

as the price of Canadian oil approaches international
levels since the tax restricts the movement of wellhead
price increases which are governed by inflationary
impact and U.S. competitiveness.

The western provinces continue to identify the National
Energy Board’s control of the supply and distribution

of natural resources as a direct federal intrusion
challenging the basic principle of provincial resource
ownership and management. They maintain that

the NEB’s suggestion that the provinces intervene during
NEB hearings does not recognize the provinces’ legitimate
role in the resources area and reduces the provinces to
the level of an interest group. Theprovinces suggest
that modifications be made to the National Energy

Board Act, as long as it maintains powers over federal
works, to ensure that the provinces have greater input into
the NEB’s decisions, possibly through provincial ‘
representation on the Board.

Although the original Act expired in June 1976, new
legislation, The Energy Supplies Emergency Act, I 979,
was passed by the House of Commons in March .
1979. The western provinces’ concerns with this

type of legislation remain the same since the new bill is
virtually identical to the original Act except for a few
minor provisions. They maintain that, as owners of
energy resources, the provinces should have a formal.
role in the decision regarding a real or perceived

. emergency and in the decisions regarding rcsou

allocation in the event that a national emergency is
declared. As such, amendments to the iAct slmtzld he
considered for the following reasons: to sttlcgii :1 rd
provincial ownership rights to resotirces z;11§id to l’liai.
any perceived emergency or problem C1311lLCfl”l”l[‘3l§ll§?{l

under section II of the legislation is vtIlii;l.




(f). Federal government legal intervention re



Saskatchewan resource management policies——
The federal government has taken an unusual
step in directly intervening by legal action
against the Province of Saskatchewan in
connection with oil and gas royalties and the
potash prorationing system.

The Task Force was concerned that this
represented another type of intrusion into
provincial jurisdiction. They agreed that it was a
demonstration of a federal challenge to provincial
ownership management and development

of natural resources.

“Canada First” policy—The stated “Canada
First” policy of the federal government with
respect to export of nonrenewable resources and
the ultimateconcept of export control on_
specific resources ‘( such as coal and uranium)
was another area of concern noted by the Task
Force. Again, although recognizing the

federal government’s ultimate control over these
matters, they felt that the various provincial
responsibilities and needs should be more
adequately recognized.

Resource Appraisal Program-—The examples of

‘ unilateral federal initiatives in this area

considered by the Task Force were the Plains
Coal Resource Evaluation Program and the
Uranium Reconnaissance Program. It was

felt that federal involvement i.n these areas
clouded the general question of resource
ownership and jurisdiction. For example, the
federal criteria for appraising coal reserves

could differ from the provincial criteria that would
be used in issuing industrial development permits.

(i) Research and Development Programs–—The

federal government has undertaken continuing
mitiatives in sponsoring research involving
provincially owned nonrenewable resources.

In light of their previous expressions of concern with
regard to this type of legislation, the western provinces
expressed regret that The Energy Supplies Emergency
Act, I 979 had been introduced in the House of
Commons without fuller federal-provincial discussions
on the terms and provisions of the draft bill. They

are encouraged, however, that some provinces will be
asked to participate in the preparation of the Act’s
regulations and will be invited to become members of the
new Energy Supplies Allocation Board.

The western provinces remain concerned regarding
federal intervention as a co—plaintiff in court cases affecting
provincial jurisdiction. They suggest that recent
Supreme Court decisions regarding Saskatchewan’s oil
and gas royalties and potash prorationing system could
weaken provincial responsibilities in the areas of direct
taxation, management of natural resources, and

over intra—provincial trade and commerce. They note
that the issue of control, management and taxation

of natural resources in relation to the control and
regulation of interprovincial and international trade has
been the subject of extensive discussions at recent
federal-provincial constitutional discussions. Theissue
remains unresolved and will likely be the subject of
further constitutional discussions.

Although the western provinces are in favour of the
principles involved in a “Canada First” policy, they
maintain that provincial responsibilities and needs
should be adequately recognized with regard to the
export of nonrenewable resources.

The western provinces reafiim their position that federal
involvement in resource appraisal programs can cloud ‘
the question of resource ownership and management.
They agreed it is necessary to ensure consistency of
federal-provincial inventory and reserves data. If these
objectives are not accomplished through direct
comparison, then the provinces suggest they should be
achieved through mutually agreed-‘upon correlation

The western provinces are not opposed in principle

to federal participation in nonrenewable energy research
programs. However, to ensure full provincial
co-operation they insist upon receiving adequate


CURRENT‘ S’I”A”l”l.J»,$3

This also has the effect of clouding the ownership
and management issues related to development
of provincial resources. Past federal research
programs have seemed to cover only one

aspect of a problem without recognizing the
broader development concerns. ~ The Task Force

_ stressed that any federal research initiatives

involving provincial resources should take
over-all provincial objectives into account.

(j) Mineral policy objectives———The objective of


the federal initiatives in this area is to set standards
in regard to resource and export pricing,
environmental concerns, and manpower objectives.
Phase I and II of the Mineral Policy for Canada
were implemented in 1972/73 and 1973/74
respectively. Phase III, which now is under way,
would give the federal government a greater

say in resource development. The Task Force
was concerned that this policy would limit the
provincial scope of management of mineral
resources. As such, they recommended a more
careful assessment of the impact of this policy
before any further implementation occurred.

The fact of resource ownership and resource
management by the province must also be noted
and expanded upon in any mineral policy

National coal policy-—The Task Force maintained
that since coal is owned by the provinces and

is limited to certain geographical areas, any
national policy must allow for the participation

of the province owning the resource and should
take into consideration the legitimate objectives of
that province.

In the nonrenewable resource area, the Task
Force called for all provinces to reaffirm their
constitutional responsibilities, to carefully
assess all federal initiatives in light of their own
objectives and to demand greater federal-
provincial consultation in these areas.

federal-provincial consultation and t‘Gtt.lltllS.lg¥, “j’il°t.l’8v‘lll¢;:ll}ll
management control of the project. As stltflt. lite
provinces are opposed to any further n‘c.~;e:.t rtzlt lllll;lt’.lll§?t?%?=t
without provincial concurrence. Care nrmst he liztlwzt

in establishing these programs to ensure tltnt prisvii‘tni:1l
research efforts are not duplicated; that tlte j?1tf‘(,)Vil”u.?liil
departments’ concerns are not ignored; and tltul.

the private sector does not become confused Willi
to the federal and provincial government’s rcspcct‘ivc‘:a
jurisdictions. First Ministers discussed this issue at. l.llt:lt“
Conference, November 27-29, 1978. They st.1‘cssccl

the desirability of continuing the work being undertakcnt
in the area of new technology and energy research and

British Columbia, Saskatchewan and Manitoba suggest
that recent actions taken were sufficient for now; however,
provincial concerns could be revived if the federal
government did not continue to recognize provincial
ownership and control of resources. Alberta maintained
that federal-provincial consultation over these

programs was unsatisfactory.

The western provinces stress that provincial ownership,
control and taxation of resources must continue to be
recognized by the federal government. They indicate

that better federal-provincial consultation and restructured
tariff policies are necessary to restore investor confidence
in this sector. A

The western provinces note that the Minerals Policy
Review called for by the First Ministers in February 1978
was tabled at the First Ministers’ Conferenceon the
Economy, November 1978. First Ministers agreed that
“Governments should continue to consult on the
appropriateness of further measures to provide greater
stability and opportunity for the mining industry in
Canada through the tax system.” The western provinces
look forward to continued federal-provincial co-operation
in developing the strategies to attain these objectives.

The western provinces reiterate their belief that national
resource policies must allow for the participation of

the province(s) owning the resource. S Decisions reached
at the Federal-Provincial Energy Ministers’ Conference
held on December 1, 1977, and the Energy Officials
Meeting, January 18, 1978, indicated that the federal
government intends to consult fully with the provinces in
the preparation of this “strategy.

The western provinces agree that federal actions taken
seemed sufficient for now, but that provincial concerns
could be revived if the federal government did not
continue to recognize provincial ownership and C()I1l_l’(‘)l’
of resources.

I 0



(1) Nuclear Control and Administration Act

(Bill C-I4)——-The western provinces expressed
concern that certain sections of Bill C-14,
particularly section 63, would remove all aspects
of exploration, mining and -milling from within
the legislative authority of the provinces.

They suggestedthat this legislation would enable
the federal government to control the management
of provincial resources, and would give the
federal government the right to explore for and
expropriate uranium. The provinces also
Wanted to discuss the provisions related to the
control of the health, safety, security and
environmental aspects of nuclear energy. They
raised serious concerns in this regard from

an administrative as well as a jurisdictional
point of view.

The western provinces also discussed the
possibility that electrical energy may assume

a substantial proportion of Canada’s energy
demand by the turn of the century. Since much
of Canada’s electrical energy production may
come from fission and eventually from fusion
reactions, the federal government by virtue of its
special interest in uranium would control a

large part of electrical energy production.

The provinces expressed concern that electrical
‘energy generation, transmission and distribution
remain within provincial control, regardless

of the type of generation or interconnection
between provinces. They agreed that the
provinces should have control over site selection
and overall planning of electrical energy
generation facilities within each province, even
when those facilities are based on nuclear
energy. ”


The Task Force notes that since the Second Report

of the Task Force was released, the provinces have
prepared a joint position paper summarizing provincial
concerns with Bill C-14. They have also made
recommendations for revisions to the bill. The inter-
provincial position paper on Bill C-14 was reviewed by
Provincial Ministers of Mines on November 2, 1978,
and accepted unanimously. This position paper was
then presented to the Hon. Alastair Gillespie, the Federal
Minister of Energy, Mines and Resources on November
2, 1978. The views of provincial ministers can be
summarized by the following statement of the
Saskatchewan Minister of Mines at that meeting: “It is
the unanimous opinion of the provincial Mines Ministers
that C-14 is simply unacceptable in its present form.

It is our view, Mr. Minister, that the federal government
has no business being involved in the ownership of,
exploration for, or mining and milling of, any resource
including uranium and thorium. In the same vein

we feel very strongly that there is no need for federal
government involvement in the areas of occupational
health and safety of workers in such industries. These
are, and always have been, matters of provincial
responsibility, and we cannot accept this continuing
intrusion into provincial jurisdiction.”

The federal government agreed to consider the
interprovincial brief and reintroduction of Bill C-14

is being withheld, while the legislation is redrafted to take‘

provincial concerns into account.



III Housing, Urban Affairs, and Land Use

The Task Force was concerned that federal intrusions

in these areas could restrict provincial and municipal
initiatives, distort provincial and municipal priorities, and
strain both federal-provincial and provincial-municipal
relations. In many instances, they have either produced
or threatened to produce conflicting legislation and
regulations between the federal and provincial

Given the extent of provincial jurisdiction in this area,

it was felt that these tensions could be eased if the
federal government related to local governments through
the provincial governments. The Task Force also
suggested that the jurisdictions of the federal and
provincial governments in these fields be more clearly
delineated and that federal-provincial discussions
toward this end begin at an early date. Bearing in mind
that any grants should go through the provinces, the
primary role of the federal government should be to
provide loan capital to finance housing and urban
development. The primary provincial role should be to
formulate housing, urban development, and land use
policies for the provinces; to deliver all housing
programs; and to sponsor experimentation and
development of new concepts and processes in housing.

The Task Force also stressed that federal-provincial
conferences of ministers and officials should be held
regularly, in advanceiof any legislative changes related
to housing or urban affairs.

1. Direct Federal Grants to Municipalities

Direct federal grants, such as the Municipal Incentive
Grant, may influence provincial policies and priorities.
Furthermore, federal actions of this nature in

most cases bypass the provincial government. It is,
therefore, important that the federal government
relate to local government through provincial

2. Housing Programs (AH OP, Assisted Rental Programs)

These programs directly affect provincial housing
policy in a variety of ways-—they could change the
balance of owner-occupied to rented housing;

they could distort provincial housing markets; and they
could counter municipal plans and priorities.

These programs also have a great impact on urban

land development. The Task Force recommended that
greater attention be paid to these results when

the proposals are being discussed initially and that

This area has undergone a major transformation in
federal policy since the First Report of the Task Force
on Constitutional Trends. The principle of global
funding and the abolition of the Ministry of State for
Urban Affairs, in particular, are likely to reduce instances
of federal intrusion and, consequently, to remove many
of the sources of federal-provincial irritation.

Western provinces welcome the federal government’s
acceptance of the principle of global funding for the
Community Services Program, and the reduction in its
direct dealings with municipalities. There is a need,
however, for continuing consultation in this area,

the responsibility for which should be borne by both
orders of government.

CMHC has effectively terminated these programs, which
have been replaced by global funding arrangements.




better policy co—ordination between the federal— A
provincial and provincial-municipallevels be a priority
for all levels of government.

. Urban Land Development Programs

Federal intrusions in urban land development

‘ through such policies as rail relocation and urban

planning studies, could influence the pattern of urban
development, the approval processfor land
development, the municipal planning process, the
timing and location of both industry and urban
development and, ultimately, regional development
within the province. The Task Force suggested
closer liaison between the various federal and
provincial agencies with regard to these intrusions.

. Natio-nal Guidelines for Land Use Policy

Although this policy has been deferred for the
present, the Task Force noted that it could easily be
revived and they wanted to reaffirm in the most
general sense, that land use is a direct provincial

Aeronautics Act Amendments ‘

The amendments proposed in Bill C-46, introduced
on April 4, 1977, would enable the federal
government to control development in the vicinity
ofairports. Since several provinces already

have legislation governing the use of such land, the
possibility of conflicting federal and provincial
standards and requirements may arise. The Task
Force agreed that federal-provincial consultation
in this regard is a necessity.

Flood Hazard Reduction Program

Concern was expressed that this program might
intrude into the provinces’ control of land use and
development. The federal-provincial program
might not complement existing provincial programs
that are adequately meeting provincial needs.

The Task Force felt that more federal-provincial
discussions in this regard would be beneficial.

‘Difficulties in this area have largely been resolved.

The demise of the Ministry of State for Urban Affairs is
expected to result in at less aggressive interest by the

4 federal government in urban land development.

Differences on this issue have been resolved.

Difliculties in this area appear to have been resolved.

It is expected that consultation will continue to

ensure compatability of standards and future projections
for long term planning of local urban development.
Federal law will apply only in the absence of provincial

Through extensive consultations, the difficulties
have been resolved.



7. Canadian Home Insulation Program (CHIP)

The western provinces maintained that energy
conservation is primarily a matter of provincial
jurisdiction, interest, and property, since it affects
matters of real property. Although the provinces
recognized that national energy conservation programs
may be necessary, they asked that such programs
recognize provincial jurisdiction and be developed in
co-operation with the provinces. They suggested

that this had not been the case with the Canadian
Home Insulation Program. The western provinces
acknowledged that the federal government had
modified its program as a result of provincial protests;
however they noted that certain technical problems

, still needed to be resolved.

8. Proposed F edera-l-Provincial Community Services


The 1978 Task Force Report identified several
provincial concerns with respect to a federal proposal
for a new Community Services Program to provide
capital grants to provinces and municipalities

as a replacement forthe Neighbourhood Improvement
Program, the Water and Sewage Treatment Program,
and the Municipal Incentive Grant Program.

The Task Force expressed serious concern about

a number of the conditions attached to the proposed
program and about the adequacy of consultation which
had taken place up to that time.

The Task Force concluded that the western provinces
believed significant changes in the proposed
Community Services Program were required before
they could reach a decision with respect to its
implementation. These changes could include

the removal of conditions with respect to the use

of federal funds and their allocation among 4
municipalities in the various provinces.

It was noted that the western provinces View matters

_ relating to the internal distribution of municipal
grants, the determination of eligibility for these grants,
and the supervision of municipal spending, as
matters exclusively within the provincial sphere.
Therefore, the scope of future federal-provincial
negotiations should be confined as matters of
interprovincial funds distribution and broad designation
of eligible spending categories. It was stated
that the western provinces wish to make clear that
in negotiations which are conducted and in any
agreements which are achieved, there must be full
recognition of provincial jurisdiction in this area.

The western provinces suggest that the inadequate
federal-provincial consultation prior to the introduction.
of the Canadian Home Insulation Program makes

it a classic example of the federal government’s
insensitivity to provincial priorities and jurisdiction.
Although the western provinces maintain that some
technical aspects of the Canadian Home Insulation
Program could be improved further, they agree that the
program is no longer a matter of provincial concern.

The major criticisms raised by the western provinces

in the April 1978 Task Force Report were valid at the
time the report was prepared. Undoubtedly, that report
and related federal-provincial meetings played a

part in persuading the Ministry of State for Urban Affairs
to alter a number of its original proposals and to

permit the achievement of considerable progress in
negotiations by the late spring of 1978.

At a meeting of federal and provincial ministers in

June, agreement in principle was reached on the general
terms of the new Community Services Program and

on the desirability of developing mutually acceptable draft
agreements as soon as practicable. However, when

the federal government’s special restraint program was
introduced in August, the possibility was raised

that the Community Services Program might be cancelled,

; deferred, or scaled down. Following limited consultations

with the provinces, the federal government announced

a deferral of the program and thus a reduction in the
proposed level of payments to provinces in respect

of both the 1979/80 and 1980/81 fiscal years. A
subsequent announcement that the responsible federal
department, the Ministry of State for Urban Affairs,

was to be disbanded at the end of the 1978/79 fiscal year,
while consistent with the recommendation of several
provinces, resulted in further uncertainty about

the future of the program at the provincial level.

In recent months, the western provinces have expressed
concern that some of the improved terms which were
agreed to in principle by ministers in June 1978 were not
reflected in further revisions to the federal Community
Services Proposal subsequent to the Autumn 1978
restraint exercise. Particular concern was voiced ahotnt





the decision to phase in the program more slowly

than had been planned earlier. Under the revised federal
proposal there will be no federal contributions toward
the program in 1979/ 80 and the maximum 1980/ 81
contribution would be $150 million in respect of
projects undertaken in the previous year-——$lOO million
less than the originally—proposed $250 million
contribution in the second year of the program. The
western provinces object in principle to the fact that the
program does not provide for interim advances to
finance projects in the year in which they are undertaken.
The concept of deferred reimbursement embodied in

the Community Services Program proposal must 8

not be viewed as establishing a precedent for other

federal-provincial financial arrangements.

The western provinces have also been particularly
disturbed by apparent efforts by the federal government,
through intensive publicity, to build up expectations.
about the program which are unrealistic in View of

the proposed terms——-and particularly the revised financial
provisions, as specified in Bill C-29. ‘

In general, the western provinces believe that federal-
provincial consultation on the Community Services .
Program has been inadequate. As noted earlier, while
significant progress was made following the release of the
Task Force Report in April 1978, this progress

was offset by subsequent alterations in the proposals

by the federal government revisions which altered terms
accepted in principle by ministers in June and which

led to renewed negotiation difficulties and protracted
uncertainties at the provincial and municipal levels.

The western provinces note that continuing discussions
will be required to deal with the future of the

program beyond 1981/82, including such matters as
total funding and the allocation of funds among

the provinces.



IV Economic Development

Recent developments withinthe federal system may

be viewed from the perspective of a conscious federal
decision to increase its role in the national economic sphere
through new policies and increased regulations.
Corresponding to such moves has been a growing,
adverse feeling in the west regarding the federal
government’s lack of understanding of regional needs
and objectives, as well as its tendency to bias economic
decisions toward the aspiration of central Canada. Both
the federal and provincial governments have legitimate
responsibilities within the field of economic development.
On various fronts, federal intrusions in the economic
development field take the form of federal actions which
limit the scope for independent provincial programs

and policies.

1. Agriculture

(a) Income Stabilization Acts—-Although these
Acts are relatively recent enactments, their
administration and responsiveness to changing
market situations could be improved. As well,
there -should be harmonization of federal and
provincial programs on a national basis.

For example, the federal government’s delay
in rectifying the situation surrounding the
cow/calf program meant that many of the
provinces developed their own programs and
that some problems now exist in harmonizing
the previous provincial programs with the
national one.

The western provinces view the February 1978 .lflt‘Sl.
Ministers’ Conference on the Economy as an importzmt
first step in developing a coherent and cohesive national
economic strategy. However, since that conference,
various ad hoc federal actions have dampened the
expectations of the western provinces in this regard.

For example, the western premiers at their conference
in Yorkton, April 13-14, 1978, were “sharply critical of
the unilateral and intrusive way” in which the federal
government had put forward the sales tax cuts as a fiscal
measure in the April 10 federal budget.‘ ~ They noted
that the federal government had not used the opportunity
afforded by the February Conference of First Ministers
to raise its proposal but instead gave the provinces

only days to consider the plan.

Another unilateral action by the federal government
which the western provinces suggest undermined the spirit
of co-operation achieved at the February First Ministers’
Conference on the Economy was the federal spending
reductions which were announced August 18, 1978.

At the First Ministers’ Conference in November 1978,
“First Ministers agreed that it was essential to continue to
discuss and co—ordinate federal and provincial approaches
to Canada’s economic problems through an improved
federal-provincial framework for consultations, discussions
and concerted decisions. They also agreed that First
Ministers should meet periodically to review economic
objectives ‘and progress being made toward such goals.”

The western provinces urge that efforts to develop
national economic policies in close co-operation with

the provinces be continued. In addition, they also
reaffirm the position they had taken at the Western
Premiers’ Conference in April 1978, that First Ministers’
Conferences should be supported by a more explicit
arrangement for follow-up and implementation of agreed
upon policies.

This issue was discussed by First Ministers at their

Conference on_ the Economy, November 1978″. They
agreed that work on stabilization should be followed up

by the federal-provincial technical committee as soon

as possible. The western provinces note that the provinces
have agreed in principle to the guidelines for a new

income stabilization program proposed by the federal
government.‘ They look forward to further coristtltatitims
with the federal government regarding this propose<;l
legislation. –



(b) Credit—-Farm Credit Corporation loans were
severely restricted as a result of a 1975 federal
budget cutback. The resulting decrease in
available credit has tended to discourage the
family farm and increased financial pressure on
local and provincial lending institutions. The
Task Force felt that this was yet another example
which pointed out the need for improved federal-
provincial co-operation in order to obtain the
objective of balanced growth in agriculture.

(C) Federal levy on fluid m.ilk——Concern was
expressed about certain aspects of the federal
government’s recently announced dairy policy
for 1977/78. The federal government’s proposal
for placing a levy on fluid milk is an intrusion
into a market that traditionally has been under
provincial jurisdiction. The Task Force
recommended that the federal government
reassess this proposed policy in light of these

9 2. Transportation

The Task Force agreed that the deficiencies in the
transportation infrastructure serving the region are a
major obstacle to a faster and more balanced rate
of economic development to- the west. The Task Force
did not question the federal government’s jurisdiction

– in the interprovincial transportation field, but rather
the manner in which the authority was exercised.
They felt that the federal government has tended to
view transportation policy in its narrowest sense.
An example of this tendency can be found in the federal
proposal to set freight rates according to “what the
traffic will bear.” The Task Force reaflirmed that
transportation is fundamental to the achievement of
diversification of “the economic base in the western
provinces. They asked that the federal government
develop a more equitable transportation system to meet
the economic objectives of the western provinces.


The western provinces note that new federal legislation

has been introduced which provides greater accessibility
for the farmer to Farm Credit Corporation loans.

While this action can be seen as a positive step, it, however,
is disturbing to the provinces that they were not consulted
prior to federal cutbacks which reduced advances to

the Farm Credit Corporation. –

‘ The western provinces acknowledge that the federal

government has responded to provincial criticisms of the
federal levy on fluid milk. A proposal was put forward by
the federal government to have the provinces collect

this levy, using the method of their choice. The western
provinces maintain, however, that federal-provincial
friction over this issue could have been avoided if the
federal government had respected provincial pricing
jurisdiction in this area and had consulted the provinces
more fully during the development of the proposal for

a federal levy on fluid-milk.

The western provinces remain concerned that deficiencies
in the transportation infrastructure serving the region

are obstacles to western economic development. They
cite the recommendations of the Hall Commission Report
as constructive proposals which would strengthen
Western Canada’s economy. They note that the Hall
Commission Report had been unanimously accepted by
the 10 Premiers at their annual conference in August
1977. The western provinces acknowledge that some
action has been taken by the federal government in
response to the Hall Commission Report. They suggest,
however, that several recommendations in the Hall
Report still require action.

The western provinces are encouraged by-progress made
towards the establishment of a Western Canadian
Transport Commission (CTC) with decision-making
powers. They also note the recommendations made in the
reports for the Law Reform Commission of Canada and I
the Management Advisory Institute of the University

of Alberta in regard to internal procedures and decision-
making practices within the CTC.

The western provinces strongly believe that the principle ‘
of using transportation as a tool for national and

regional economic and social development, as proposed
in new national transport legislation, is more appropriate
than the philosophy of the 1967 National Transportation
Act, which relied on competition. They request that

this principle be formally implemented and made



_3. Trade (GATT)

Although the federal government’s responsibility for
negotiating international trade agreements is clear
and is therefore not an “intrusion” the Task Force
viewed provincial input into the final position on
international trade negotiations to be of utmost
importance, given the significance of foreign market
penetration to the realization of western economic
development objectives. The liberalization of

trade barriers is vital to the development in the west
of a secure economic base; to aid industries reliant
on natural growth through secondary industry; and to
develop a strong manufacturing sector. As a result,
the Task Force called for a more active and substantial
role for the provinces in the formulation of national
policies in such areas as GATT negotiations.

4. Industrial Development

The Task Force expressed concern that many of the
federal government’s recent industrial development
strategies ignored regional aspirations and disregarded
the concept of upgrading near the source of raw
materials. With regard to the Federal Throne Speech
announcements of upcoming aid to small business,

it was felt that this federal proposal was commendable
but that care should be taken to ensure that the

policies developed are complementary to the aspirations
of the provinces.

5. Environmental Concerns

Recent federal initiatives in the area of pollution
control regulations have caused some duplication
and have implications for resource ownership.
Federal environmental studies are another area of
concern since they may result in recommendations
affecting provincial land use, water use, and ‘
development programs with little ‘regard for specific

operational. They further ask that the feclcral g.f,t.lVf1;‘l’l’llll£ii”3t’ll,’.
develop a more equitable transport system to mt:<.ét lLl‘n: economic development objectives of the western [.”ll”t’.’)\.I‘ll’l.t;.,’:f..”-it and undertake ongoing meaningful consultation on transportation developments and requirements. The western provinces are encouraged by the improvement over the past few months in federal- provincial consultations concerning the Multilateral Trade Negotiations. The western provinces note that, although completion of the Multilateral Trade Negotiations is imminent, international commercial issues will continue to be areas of both federal and provincial concern and will continue to require a co—ordinated response. Since it appears that I a number of the Western provinces’ trade objectives will not be met, they suggest that thought should be given to post-MTN steps that can be taken to achieve those objectives. Furthermore, the implementation of the international codes of conduct on nontariff measures will affect certain areas under provincial jurisdiction. The western provinces suggest that ongoing formal federal- provincial consultation will be required in the approach to the development and future operation of the nontariff measures agreements. The western provinces agree that the First Ministers’ Conference on the Economy, November 27-29, 1978, was a positive step toward the development of an ongoing federal-provincial process that would ensure better co-operation and co-ordination in economic policy areas. They stress the need for both federal and provincial governments to act on the commitments made at the November Conference regarding federal-provincial co-operation in industrial development policies. In this regard, the Western Premiers are concerned about the lack of consultation on new programs announced in response to the Tier II report. This is not in the spirit of the commitment of First Ministers. The western provinces also consider that the establishment of regional business, information centres is an unnecessary duplication of services provided by the provincial governments. The western provinces note that the issue of environmental protection is being considered in flit; context of the duplication exercise. They are Cl’lt§tl;’’§.lg§§(.l that the federal government is reacting to provincistl concerns and plans to develop a newei‘tvirotum:x1tnl protection strategy in consultation with the j‘l’t‘t.‘i‘\a‘lllt”t?%3, SUMMARY OF TASK FORCE CONCERN AS _EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS provincial needs. With regard to environmental ’ matters, the Task Force recommended that priority be given to provincial objectives and suggested that in many instances federal minimum standards with provincial responsibility for application and enforcement would resolve most conflicts. DREE The potential for a conflictbetween DREE activities and provincial priorities exists. With this is mind, the Task Force agreed that there must be recognition 28 that the provincial governments retain primary responsibility for establishing the priorities for economic development. All DREE subagreements should reflect provincial priorities. To ensure compatability with provincial objectives, priority should be given to sharing of existing or planned provincial programs rather than the creation of new programs to suit DREE involvement. The western provinces reiterate their concerns that DREE remain responsive to provincial priorities. They note the commitments made by the First Ministers at their Conference on the Economy, November 1978, regarding regional development and reaffirm their commitment to a co—ordinated federal-provincial approach to the reduction of regional disparities. SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN SECOND REPORT (1978) CURRENT STATUS 7. Proposed Federal Transportation of Dangerous Goods Act Federal-provincial discussions over this issue date back to 1973. The draft proposal, dated August 1977, contained provisions which ignored the division of legislative authority by purporting to legislate in relation to transportation by vehicles and in undertakings that may be wholly intra-Provincial. The Task Force noted that the draft invited constitutional challenge and disregarded the previous federal-provincial consensus which recognized appropriate federal and provincial constitutional responsibilities. Under the proposal, the federal government purported to be responsible for I determining whether or not the Act’s provisions applied in a Province. In spite of these constitutional issues, the provinces regarded the Act as a necessary and positive step. . Fisheries Act The western provinces expressed grave concern that recent amendments to the Fisheries Act have the potential for representing an unwarranted intrusion into Provincial affairs and constitutional jurisdiction. These amendments repudiated any acknowledgment of the Province’s Own Environmental Control and Water Resource Management programs which have been operating effectively, harmonizing with federal-provincial mechanisms. There was concern with the amendments’ effect on the management of provincial resources and economic development and the possible dominance of a single resource—fiSh——at I the expense of integrated resource management and use. In spite of Strong representations to the federal government, provincial concerns were not taken into consideration. The western provinces urged an immediate review of the Fisheries Act, with a View to the amendment in particular of sections 28, 31 and 33 at an early date. Abandoned Rail Rights-of-way The western provinces believe that abandoned railway rights-of—way should revert to the provinces not the federal government. The actions of the federal government, in providing the federal Minister of Transport with the ultimate land—use decisions In the year that has followed the identification of this concern by the Task Force, federal and provincial consultation on this matter has continued with the l’et.lernl government tabling Bill C-53 in May and a revised Bill (C-17) in November of 1978. The section 29 (2) which now appears in Bill C- l 7 provides that where the provinces have entered into an agreement with the Government of Canada the Federal Cabinet may by proclamation provide that the Act or any of its provisions “shall come into force in that province with respect to . . . transportation of dangerous goods in that province by any means subject to the legislative authority of that province that is agreed on. . . .” This revised wording of section 29 (2) appears to satisfy the concerns of the western provinces respecting recognition of provincial legislative authority over intra- provincial transportation. In spite of federal protestations to the contrary, the extent of federal consultation with the provinces on the Fisheries Act amendments has not been sufficient. The federal position that the regulations reflect the views of provincial and industrial representatives cannot be sustained. The negligible impact of concerns expressed by these parties on the federal positions would indicate that these “consultations” were a formality that occurred after the federal authorities had adopted firm positions. Management of the Seacoast and Inland Fisheries through the Fisheries Act is not in dispute. However, the single-minded manner in which the federal agencies approach their task and the implications on provincial resource management remains an issue. The western provinces look forward to a broader and fuller consultative process in this important area through the new federal environmental protection Strategy. The western provinces continue to be C()Il.Gt3l‘l‘l£:(.l this federal intrusion into provincial jLll’l.3(..llé;:l’.lt3I‘t. The federal government has inviitecl provinces to an a representative to acommittce in eztclt j‘:m;:vi:e1::e ls-“*él‘l’t%;.i”l’i. will review use of these lands. ‘M.itlllltll‘l§i tttlil SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN SECOND REPORT (1978) CURRENT STATUS 30 for abandoned rail rights-of-way, represent a clear intrusion into areas of provincial jurisdiction relating to land-use planning and control. These actions have had a negative impact on provincial policies and programs, and militate against future land-use planning by the provinces for the abandoned rights of way. The Task Force noted that neither the Hall Commission nor the provinces were ever consulted with respect to the position of the federal government. Saskatchewan have appointed representatives to their provincial committees; to date the committees have not been particularly active. SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS V Communications Recent federal actions, in the field of communications, have tended to expand federal control over those aspects which are entirely local and intra—provincial in nature, such as closed—circuit cable and educational television, provincial laws relating to commercial advertising, and cable distribution systems. The Task Force felt that some aspects of communications should be Subject to provincial control and jurisdiction. The provinces frequently shared common concerns with _ respect to these federal intrusions in the communications policy field. The Task Force made the following comments and recommendations: 1. Telecommunications (a) Cable televisio-n-——The federal government, through the extension of its authority under the Broadcasting Act, has proposed policies which will involve federal regulation of closed- circuit Services provided by coaxial cable. Recent actions taken by the Canadian Radio- Television and Telecommunications Commission (CRTC) in regulating Master Antenna Television Systems and in Cable television licensing have also expanded federal control over cable communications systems. The Provinces of Alberta, Saskatchewan and Manitoba recommended that cable services which do not directly involve the relay, retransmission, or amplification of broadcast signals be clearly subject to provincial control. Undertakings ( which offer these nonbroadcast services should be required to submit to provincial regulations ‘ in so far as these services are concerned. The Province of British Columbia was sympathetic to this view. (b) Cable distribution systems——-The Provinces of Alberta, Saskatchewan and British Columbia recommended that cable distribution systems, being local works or undertakings, should be subject to provincial law, in accordance with section 92 (10) of the British North America Act. They also agreed that control and regulation of cable distribution systems should revert to the provinces; and that the federal government should continue to regulate these Systems only in relation to their use within the Canadian broadcasting system. The respective jurisdictions of the federal and j3i*ovint:inl governments in the field of communications have l‘)t;:C«!l reviewed in the constitutional discussions which culminated with the First Ministers’ Conference last February. Four aspects were considered-—-radio spectrum management, telecommunications carriers, l’fl(fll4_.’! and television broadcasting, and cable distribution. On the last of these, cable distribution, some progress was made toward resolving the conflicting views between the federal government, on the one hand, and the i provinces, on the other. In the constitutional review, the federal government has proposed that the provincial and federal governments exercise concurrent jurisdiction in the field of “cable distribution”. Cable distribution would be interpreted to include broadcast signals, local closed-circuit audio and video services (Such as pay TV, teleshopping, ’ automatic utility readings, etc. ) , as well as the facilities and hardware. In the event of conflicting laws, the authority of the federal government would be paramount in all matters relating to——Canadian content, Canadian broadcast programs and services and technical standards. In the remaining areas, provincial legislation would have paramountcy. Most provinces Seem prepared to accept concurrent jurisdiction as a reasonable basis for agreement, notwithstanding their position that cable distribution Systems,being local works or undertakings, should be subject to provincial law in accordance with section 92 (10) of the British North America Act. Some concern remains, however, with the term “cable distribution” and with the areas of federal paramountcy as expressed in the federal draft. The proposal for concurrent jurisdiction with federal paramountcy in some aspects, would conceivably extend federal power to areas such as wholly [closed- circuit services, which are now in many cases under provincial authority. On June 6, 1978, the CRTC announced its intemrion to “give prompt and favourable consideration to applications by cable television licensees for the use of their systems to provide new communication Stan/ices of a 31 SUMMARY OF TASK FORCE CONCERN AS . EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS nonprogramming nature”. Several applications to carry such nonprogramming (nonbroadcast, closed- circuit) services were heard by the Commission at a public hearing in Ottawa on November 21, 1978. The Provinces of Alberta, Saskatchewan and Manitoba consider closed circuit, nonprogramming a matter under provincial jurisdiction and beyond the CRTC’s authority to regulate as part of the Canadian broadcasting system. Thus, on December 6, 1978, the Government of Alberta ordered the Provincial Public Utilities Board to undertake a public inquiry into the regulation of local “nonbroadcasting” telecommunications in the province, including pay TV. Pay television———The federal government through ‘ The western provinces regard closed-circuit pay television the extension of its authority under the Broadcasting Act, undertakings as “local works or undertakings” subject has proposed a policy toward pay television which will _ to provincial jurisdiction. The issue of pay television was involve federal regulation of closed-circuit entertainment discussed at the Communications Ministers’ Conference services carried by means of coaxial cable. on March 29, 1978. Several provinces emphasized provincial interests and jurisdiction in this area. Although no consensus as to jurisdiction was reached among ministers, the federal minister did» agree to work with provinces in developing a proposed framework for pay television in Canada. Some consultation took place between federal and provincial governments in early 1979. Although the possible shape of a national framework for pay TV has been discussed, a definite model has not yet been developed. The western provinces believe that the major principles _ relating to pay TV must continue to be discussed in the ministerial forum. They expect such discussions to take place at thenext meeting of federal and provincial Communications Ministers. 2. ‘Educaz‘i0n and Cultural Communz°catz’0ns The federal government’s attempts to impose a The western provinces continue to believe that “shared definition of “programming” on the provinces regulation and common-use arrangements with respect to would restrict a provincial government’s use cable television must be founded on genuine respect of communications technologies to deliver social, for the needs of provincial governments to exercise fully educational and cultural services to the public. The their legitimate powers in the fields of education, Provinces of Alberta and Saskatchewan agreed ‘ S health, local-civic, local—cultural, and community matters.” that educational communications carried out by means Greater influence over theregulation and use of cable of cable or wire technology should be exclusively a distribution systems is a means whereby provinces provincial concern. British Columbia was sympathetic can more effectively carry out their traditional roles and to this position. Manitoba had already satisfactorily responsibilities in these areas. resolved this issue with the Federal Government through their agreement on programming and carrier ownership. .. In addition, the western provinces continue to note i the low level and quality of broadcast television and radio services in rural and remoteareas. A recent study shows, for example, that almost 40 per cent of rural Saskatchewan residents are unable to receive a second SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS Educational Television 3. Commercial Advertising Regulation The CRTC’s steps to regulate commercial television will affect the validity and scope of provincial laws relating to advertising. The Provinces of British Columbia and Saskatchewan agreed that the commercial content of advertisements used by broadcast undertakings should be subject to provincial laws relating to advertising. They recommended that formal delegation of this responsibility to the appropriate federal regulatory agency responsible for the implementation of provincial laws vis-a-vis broadcast licencees be considered, provided the federal government enters into bilateral arrangements in this regard. ‘ network (CTV) service. In Manitoba, 25 per cent of rural households are in this category. In light of (hi-4 situation, it is difficult to justify the continued l‘Cl’ilflCll(.)l’l on provincial roles and responsibilities with res pect. to broadcast services. Except within the limited area of “educational broadcasting” as defined by federal authorities, provinces can neither regulate not engage in broadcasting operations designed to remedy this imbalance and inequity in levels of service. In the course of the constitutional negotiations, the western provinces have disagreed with the federal government’s refusal to contemplate shared jurisdiction in the area of broadcast television and radio. Moreover, several provinces have opposed the federal government’s position that wider provincial responsibility in the field of cable TV must be conditional on provinces’ recognition of federal jurisdiction in respect to various program and technical aspects of closed-circuit cable services. The western provinces expect the process of constitutional reassessment to continue, and they will continue to press for constitutional measures which give provinces a greater role in the educational,local and community aspects of broadcasting and cable television. The western provinces continue to believe that “federal restrictions on, or regulation of, the use of television for educational purposes (except technical matters in the V case of an educational broadcasting transmitter) are inappropriate. .” During the recent series of constitutional discussions, the federal government offered to discuss administrative arrangements which could widen provinces’ ability to engage in broadcasting operations and utilize television as an instrument ofeducational policy. Such administrative arrangements should be put forward for serious consideration as soon as possible. The western provinces have not changed their position from that stated last year, namely, that provincial laws of general applicability relating to commercial advertising be respected by federal broadcast licencees and by the federal regulatory agency. To this end, the federal government has informally indicated that specific pFOCll.l(Jlf advertising might be a subject for administrative delegation of regulatory responsibility to the province. It is essential that the proposed administrative arrangements be put forward for consideration at an early (late. a With respect to the deletion of liquor advertisements imported by means of cable TV where such aclvertising 33 4. 34 MHY” on TASK FORCE CONCERN AS l=i?«:l‘l{l‘?ISSl%3D IN FIRST REPORT (1977) CURRENT STATUS Federal Interconnection Policies The federal government’s interconnection policies favour a liberalization of rules which permit the connection of customer-owned terminal attachments and interconnection between the networks of federally regulated carriers. The Provinces of Alberta and Saskatchewan recommend the provinces continue to oppose any federal moves encouraging these actions, which would diminish the province’s control over their telecommunications carriers, and which would result in a deterioration of levels of services to remote and rural areas. British ‘Columbia was sympathetic to these views. is forbidden by law, the CRTC continues to refuse to authorize its licencees to adhere to the provincial legislation involved. Over the past year the Province of Saskatchewan, for example, has held lengthy discussions with the federal Minister of Communications but has failed to secure their co-operation in resolving this problem. In the area of interconnection, the western provinces believe that national policy should be a product of serious, sustained consultation among governments. To this end, federal and provincial Communications Ministers agreed in Charlottetown on March 29, 1978, to establish an Officials Working Group on Telecommunications Industry Structure and Competition, with instructions to “develop policy principles or criteria which would ensure that telecommunications services in Canada are provided in a manner consistent. with public interest.” An interim report of the Working Group has been distributed to Communications Ministers. This Report sets out certain policy objectives and principles, and also identifies a number of issues for ministerial consideration. However, there rests before the CRTC particular regulatory matters, e.g., the CN/CP-Bell interconnect case, which could be decided in the absence of any agreed national policy framework or guidelines. Without such guidelines, a unilateral determination of these matters by the federal regulatory agency could be seen to ignore the significant policy and jurisdictional interests of provincial governments. ~ For this reason, some western provinces consider , essential the deferral of certain critical regulatory decisions respecting interconnection pending the completion of efforts by Communications Ministers to develop national policy principles and guidelines. SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN SECOND REPORT (1978) CURRENT S’l‘A”l“l)S 5. Trans-Canada Telephone System The western provinces expressed concern over the apparent interest by the federal government, through the CRTC, in assuming regulatory control over the operations, finances and practices of constituent member companies of the Trans-Canada Telephone System, including provincially owned and regulated companies. Such action would threaten to undermine provincial decision-making and to diminish control by provincial telecommunications _ carriers over their rate structures. The concerns raised in the Second Report of the Western Premiers’ Task Force over the x‘cgulatt.iry intentions of the CRTC have since been conlimierl. In a Public Notice of August 4, 1978, the CRTC reitet’2alt:24;l its intention to become involved with the rates and practices of all the signatory companies to the ‘flit’:-tll”‘1.‘=..€*~ Canada Telephone System connecting agreement including the provincially owned and/ or regulated Ci-lt’I‘lI3t’1s* like Alberta Government Telephones, Saskatchewan Telecommunications and Manitoba Telephone System. It also outlined the steps and procedures it planned to initiate prior to scheduling a public hearing on the subject. Since that date, the CRTC has published the terms of reference of its pre-hearing study, engaged its consultants and has constituted under its chairmanship an inter- regulatory committee composed of interested “provincial regulatory agencies or their equivalent to assist the CRTC on aspects of the consultant’s study. Although the interregulatory committee represents a mechanism whereby provincial and federal regulators can , exchange information and perform other liaison functions, it is not entirely satisfactory as a consultative forum out of which compatible regulatory policies and decision making can emerge. The committee is chaired by thefederal agency and its functions are severely limited by terms of reference which are defined by that agency alone. It would be preferable to establish a more balanced consultative mechanism which could reflect provinces’ legitimate policy and regulatory interests, as well as those of the federal government and its agencies. The CRTC’s move to appropriate and exercise regulatory authority in relation to T CTS connecting agreement signatories’ rates and practices continues to be of serious concern to western provinces which own their telephone systems. As the Task Force’s Second Report points out: “By having a significant measure of control over all the revenues earned, as well as the facilities operated, by their common carriers, provinces are able to determine the extent and quality of communications service within their territories”. By taking unilateral steps to regulate the operations and revenues of the signatories to the TCTS connecting agreement, the CRTC is undermining the practicality and CllCCllVCl”l(:Sé% of provincial planning in this area. 35 SUMMARY OF TASK FORCE CONCERN AS ‘ EXPRESSED IN SECOND REPORT (1978) CURRENT STATUS 6. 36 Video Games The western provinces expressed concern with the federal government’s intention to set standards for home TV games, under the authority of the Radio Act. Such standards are consideredto be properly a consumer protection issue, not a matter relating to federal responsibility for radio communication or television broadcasting. Federal officials have indicated that technical regulations for home TV games under the authority of the Radio Act would be limited to the prevention of harmful interference with radio communications, and would not extend to consumer protection issues. They have promised to consult with the provinces S before regulations are drafted. No consultation, however, has yet taken place. SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) CURRENT S”l?‘A‘l.’l,.J;‘.?% VI Demography and Immigration, Manpower and Training, and Labour A 1. Demography and Immigration The Task Force expressed the position that demographic and immigration policies must be co—ordinated with regional economic development, housing programs, transportation programs, and urban development and land policies. The full and active co-operation of the provinces should be the criterion for the development of these policies. The Task Force recommended co-operation with the federal government indeveloping a national demographic policy. They requested, however, that this initiative be examined from a provincial perspective and provincial objectives be established. It would be unsatisfactory if only the federal government was involved in developing the policy leaving it to the provinces to provide the infrastructure. Since both federal and provincial jurisdictions are involved, any national policy which is developed must reflect the concerns of both levels of government. With regard to the new Immigration Bill, the provinces should attempt to obtain a consultative mechanism permitting consideration of the broad range of provincial interests in immigration policy, and ensuring acceptance of provincial concerns on issues of critical importance to the provinces. 2. Manpower and Training The Task Force identified three major concerns in this area——the Community Employment Strategy, the Adult Occupational Training Program, and apprentice training programs. They generally agreed that, although the federal and provincial governments both have legitimate responsibilities in the manpower and training policy area, there is a tendency for federal involvement to overlap provincial jurisdictions. The Task Force suggested that a comprehensive federal- provincial agreement outlining specific functions besought. With respect to the community employment strategy and the apprenticeship training program, the Task Force suggested that the provinces demand the primary responsibility for their strategy development and program management. As noted in the 1978 Task Force Report, the (.ill£..lV§il“illl’l§Ei§li. of Canada has indicated its wish to continue C2t)i’lf§l.lll.i:’il=lili”i§%i with the provinces about the implications of the lietlmtl approach to demographic and immigration policy following the western provinces’ expression of Criyttcem in the 1977 Report. The development ofibilateral federal-provincial immigration agreements remains txmitier consideration and further consultation on this matter will be required. The Canada Employment and Immigration Commission tabled a discussion paper on labour market policies at the First Ministers Conference on the Economy in November 1978, and follow-up meetings were proposed by the , , federal Minister to discuss a broad range of federal— provincial concerns. arising from the discussion paper. In the 1978 Task Force Report it was noted that western provinces believed a number of their concerns about past federal manpower policies should be addressed in future negotiations, possibly related to the development of comprehensive manpower agreements. The November 1978 federal discussion paper proposed the development of,“umbrella” agreements between the federal govermncnt and individual provinces which would outline a strategic approach to labour market needs for a period of several years. Some of the general concerns of the western provitcnces with respect to manpower and training n1at;ters ll.’l(,L’; the lack of clearly defined responsibilities liar the two 3 ‘7 SUMMARY oF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS 3. Labour Until recently, provincial labour policy has been relatively free from federal influences. But, with the « publication in the fall of 197 6 of Labour Canada’s 38 Papers Respecting the Post Control Period this situation changed. The Task Force’s concerns with these proposals were that the federal proposals could be in conflict with provincial policy objectives; if implemented they could exert pressure on provincial administrations with respect to the development of levels of government; the proliferation of federal programming, particularly in the job creation area, resulting in duplication of effort, questionable effectiveness and confusion among the public and employers; the need for a closer relationship between manpower and employment efforts and economic development needs; the desirability of clarifying criteria both for determining A federal funding and for allocating it among the provinces, and the importance of increased private sector involvement in manpower policy and programming. The western provinces believe that manpower training is vital for achieving improved economic growth and stability and feel it is critical that the federal government provide increased support for job-related training. Currently, the federal government finances and administers institutional-based and industrial-based training separately. The western provinces believe there is a need for greater co—ordination and for greater use of combinations of the two forms of training, while ensuring that increases in industrial training do not occur at the expense of institutional training. It is felt that more flexibility in regulations pertaining to industrial-based training is required and that there should be re-examination of federal training allowances. The western provinces generally favour long-term financing arrangements for manpower and training programming and feel that these arrangements should be worked out in the context of an overall strategy which ensures that adequate funds are available sufiiciently in advance of anticipated development activities and related manpower needs. A It is noted that the federal government has abandoned its “Community Employment Strategy” program, a subject of concern to the western provinces as noted in 1977 and 1978 Task Force Reports. With respect to apprenticeship training, the western provinces will ensure as noted in the 1978 report, that such programs will continue to be considered in the context of the provinces’ overall responsibility for such matters. Federal-provincial discussions concerning Labour Canada’s various post—control proposals continued during the last year and were co—ordinated to an extent with related Manpower consultations. While the creation of the Centre for the Study of Inflation and Productivity Within the Economic Council of Canada represented, in part, a response to provincial concerns about the potential role of a post-Anti Inflation Program monitoring agency, the western SUMMARY OF TASK FORCE CONCERN .AS EXPRESSED IN FIRST REPORT (1977) parallel provincial sector programs; expectations may be created that the provincial governments will continue the programs if federal funding ceases; and these proposals amount to the emergence of a federal presence in industrial relations in areas now under provincial jurisdiction. The Task Force felt that the provinces should continue to co-operate in the development of these initiatives, but careful assessment should be made of the impact on provincial jurisdiction. They felt that if the provinces did not become involved in the assessment and development of these concepts, the federal government would fill the void. This could result in these future initiatives réflecting only the federal viewpoint. The Task Force reaffirmed that the provinces must seek to exert their influence in order to protect provincial jurisdiction. VII Administration of Justice Federal intrusions in the area of the administration of justice represent a pervasive federalinterest to expand the federal presence throughout the justice system. Although the Constitution entrusts to the Parliament of Canada the responsibility to make criminal law (s. 91 (27) ), the Constitution imposes on the provinces the responsibility to administer and enforce those laws as part of provincial authority over the administration of justice (s. 92 (14)). Oftentimes federal law-making has direct cost implications to the . provinces———a factor which federal authorities often do not fully. appreciate. Numerous examples could be cited to Show that no assessment of the cost impact or effect on provincial fiscal priorities is made by the federal government before deciding to legislate. Examples include amendments to the Criminal Code in recent years relating to bail, lotteries, and the privacy provisions. ’ The provinces are also concerned with recent federal activities that clearly appear to go beyond federal legislative competence to the detriment of long established provincial practice. 1. Federal Court of Canada The Task Force is concerned that the Federal Court Act purports to give that court jurisdiction in areas previously exercised by the Superior Courts of the provinces. Some provisions of the Act conferring criminal and civil jurisdiction appear to be unconstitutional. The purported jurisdiction of the Federal Court has serious practical disadvantages CURRENT ST/\’l”l.l provinces note that federal-provincial C(‘)l’l..-*it.lll.t3lltit’i “whit respect to the abolition of CSIP and its I*ej>l;u:en1e:%:itt.
with the National Commission on Inl‘l{:lll(f)l‘l tttiisiitnal.
The provinces will be assessing the resp.oIisil:Iilitit:‘as til’
the new agency in relation to the concerns Wl’lli.3l1
expressed at the First Minister’s Conference on t he
Economy in February 1978.

With the exception of the “Peace and Security Package”
and “Family Law” provincial concerns in the area of
administration of justice remain generally unchanged from
the previous report.

Although recent decisions of the Supreme (f‘nint of
Canada have put some limits on the Fetltmtl _t;T‘“t.‘s
jurisdiction provincial concerns renixain tin:

The federal government has been _]h“)i“(‘ii.i.”l§tf——*’-ltigéfg in
to the concerns respecting this /~s\.r’:t for lil‘l£§
years and the provinces expt:t:t (l.W)lil.t’.l‘xi<’§.”l’. to tit: its commitments shortly. SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) ‘ CURRENT STATUS 40 to the administration of justice in the province and to the citizens of Canada generally. Amendments to the Federal Court Act to significantly_ lessen the jurisdiction of the Federal Court of Canada, previously promised by the federal government are awaited. . Prosecutorial Responsibility Historically and constitutionally the provinces have been responsible for prosecutions and have been administering the criminal law of Canada, except in those cases where the provinces have expressly given the prosecutorial function to the federal government. However, in the past few years, the federal government has taken on a prosecutorial role arguing that the provinces exercise the prosecutorial function not on the basis of the constitution but at the sufferance of the federal government. There are serious disadvantages in having a federal prosecutorial role. It is the view of the Task Force that the administration of justice is a provincial responsibility and that prosecutions for any criminal offence in the widest constitutional sense should be conducted by or under the authority of the provincial Attorneys-General. . “Young People in Conflict With the Law” Legislation The enactment of this legislation could escalate provincial administrative costs and force changes in existing provincial legislation. Since the legislation has not been presented yet, the Task Force does not adopt an oflicial position but raises the issue to express their concern. . Family Law Developing federal intrusions in the area of family law include the representation of children’s interests in divorce proceedings, property reallocation upon marriage dissolution, and provision of provincial social services in line with federal interests. The Task Force is concerned that through the enactment’ of these recommendations, the federal government would enter the property field, a traditionally provincial area of jurisdiction. It is suggested that the federal recommendations must not intrude into provincial jurisdiction but be complementary. In the area of family property where all provinces are examining provincially based strategies, the federal government should not attempt to override the provinces. It is to be noted that this matter is now included in the broader “federal-provincial study of duplication and has been suggested as an additional item for study under the continuing constitutional review. There has been no progress respecting this matter since previous reports. There is a basic difference of policy between the two levels of government which now awaits the outcome of R. v. Hauser a case to be decided by the Supreme Court of Canada shortly. The western provinces have responded to the latest draft Young Ofienders Act and still have concerns with ‘ respect to cost sharing and the age of the youth covered by the legislation. It was agreed that further consultation was necessary to resolve outstanding differences. The western provinces are heartened by the recent federal constitutional proposals in this area and look forward to implementation of the agreed upon changes. SUMMARY oF TASK FORCE CoNCERN AS EXPRESSED IN FIRST REPoRT (1977) CURRt43’N‘l‘ S’l”A.‘i‘t.I.5‘ 5. “Peace and Security” Package——Gun Control Legislation The western provinces’ concern centres on the ’ cost of implementing aspects of the package and, in particular, gun control legislation, which has recently been the subject of much controversy. The provinces have resisted a purely administrative role Since costs would be imposed upon them without any provincial input and since the legislation could not be adopted separately by the provinces to meet the needs and interests of their residents. The Task Force asks for a review of these proposals that would take provincial concerns into account. 6. RCMP Matters (a) The federal component of the RCMP is being substantially increased in the western provinces. The provincial police forces, including provincial components of the RCMP, stand to diminish in Strength as the federal presence increases. While some provinces indicate that the present arrangement is acceptable, others are concerned that there is no provincial administrative control over this enlarged police component. (b) The Marin Commission Report is a study of the procedures to be employed in servicing citizen complaints against the RCMP. If its recommendations were to be adopted, provincial authorities believe that the present operation of the discipline codes of the various provincial police acts would be negatively affected. The provinces’ lack of control over RCMP complaints would be confirmed. Some provinces consider police disciplinary matters to be a provincial responsibility while others are prepared to continue the present practice or abide by changes made in accordance with the Marin Commission recommendations. This matteris no longer current as the Itiajnr expressed by the Task Force have been ra~ttiilve:;l. (a) (1?) Provincial concerns remain the same. Although there is continuing consultation respecting RCMP matters the provincial concerns respecting RCMP accountability and responsibility have not yet been resolved. ’ The Marin Commission Report will be superseded. by the findings of the McDonald Commission of Inquiry and it is hoped that consultation will take place after that Commission makes its report. In the meantime the western provinces wish to make clear their view that the responsibility for ensuring that police forces within a Province obey the lawrlies with the provincial Attorneys-General and object to a federal inquiry into the operations of the RCMP in respect of the force’s provincial responsibilities. 4 l, SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN SECOND REPORT (1978) CURRENT STATUS 7. Proposed Canadian Transportation Accident Investigation Commission On August 4, 1977, the federal Minister of Transport tabled a discussion paper on legislation to establish a Canadian Transportation Accident Investigation Commission for the investigation of civilian accidents involving a loss of life in transportation modes subject to federal Safety regulations, including air, marine, rail transportation, and pipelines. All provinces expressed concern with the federal proposal. In particular, jurisdictional and operational conflicts were foreseen with respect to the responsibilities of Provincial Coroners, who determine the cause of all unusual deaths in a province, and the proposed commission which is to determine the cause of accidents. It is difficult to split these responsibilities. In many cases they are essentially the same. Furthermore, it was proposed that information gathered by the commission would be privileged, thereby impeding provincial law-enforcement officers in administering justice in the province. Conflicts over authority for the removal of wreckage and over-all command of an accident scene were also of concern. The western provinces recommend that, should such a commission be established, the enabling legislation should clearly make the commission subordinate to both the coroner’s inquiry and criminal investigation. 42 Since the Second Report was prepared there have been several meetings of federal and provincial representatives notably the Deputy Attorneys-G eneral, who are to meet again in April to discuss this matter. The provinces feel that progress is being made through these discussions. The provinces continue to be concerned with respect to access by coroners and other provincial law-enforcement officers to information being gathered in the course of an investigation and not at its conclusion. While the federal government appears to recognize provincial concerns it did not meet them in explicit terms in Bill C-40 which it introduced on February 12, 1979. The authority of provincial coroners and police vis-cl-vis the Commissioner of Transportation Accident Investigation should be clearly spelled out in the Act _and it should be made clear that these Provincial authorities will have access to all information gathered by the Office of the Commissioner during the course of an investigation. The western provinces look forward to continued consultation on this matter with a view to amendments to the present bill that would more adequately reflect the provinces’ concerns in order that it will be clear that Administration of Justice in the provinces will not be hampered by the Commission. ;.:a.~: .-., ;;.-‘:_, SUMMARY OF TASK FORCE CONCERN AS EXPRESSED IN FIRST REPORT (1977) CURRENT STATUS VIII 1 Interventions by the Government of Canada before the Supreme Court of Canada in Opposition to Provincial Legislation During the last four years (from January 1973 to January 1977) the federal government has attacked the validity of provincial legislation in nine of the approximately ten cases in which provincial legislation has been challenged during this period in the Supreme Court of Canada. This does not take into account those cases at the Court of Appeal level which have not been or are yet to be appealed to the Supreme Court of Canada where Ottawa has similarly intervened in _ opposition to provincial legislation. It appears that there is an increasing tendency on the part of Ottawa to oppose the constitutionality of provincial legislation. Furthermore, the provinces are concerned over the recent practice by which the federal government has actively aligned itself as a plaintiff with parties in court cases challenging the constitutionality of provincial resource legislation. It is felt that the co-plaintiff strategy , represents an unnecessarily aggressive approach by the federal government to this matter. V ~ Federal intervention as a co-plaintifi in the Central Canada Potash Case, regardless of the issue, continues to be viewed as part of an aggressive federal stance N toward provincial taxation and control of the provinces’ natural resources that may hopefully be resolved through the constitutional review. ‘ The matter of federal government intervention as one of the parties in constitutional litigation, rather than as just an intervenant, is seen as a basic dilference in policy between the federal and provincial governments. 43 \lO\LIt-htntx.) 10. ll. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 44 SUMMARY OF CURRENT STATUS Item I CONSUMER AND CORPORATE AFFAIRS . Borrower’s and Depositor’s Protection Act . . Competition Policy (Stage 2) . Bank Act 1977 . . Electronic Payments Systems . Trade Practices . . Bankruptcy Act . . Proposed Mutual Funds Act and Securities Act II RESOURCES (a) Renewable . National Forestry Policy . (b) Norzrenewable . Nondeductibility of Royalties Petroleum Administration Act . Ten—cent,Excise Tax on Gasoline . National Energy Board Act . Emergency Supply Allocation Act . Federal Government Legal Intervention: Saskatchewan Potash . . “Canada First” Policy . Resource Appraisal Programs Research and Development Programs . Mineral Policy Objectives National Coal Policy . Nuclear Control and Administration Act (Bill C-14) . III HOUSING, URBAN AFFAIRS AND LAND USE Direct Federal Grants to Municipalities . Housing Programs (AHOP, Assisted Rental Programs) . Urban Land Development Programs (Rail Relocation and Urban Planning Studies) National Guidelines for Land Use Policy . Aeronautic Act Amendments Flood Hazard Reduction Program . Canadian Home Insulation Program (CHIP) Proposed Federal-Provincial Community Services Program Agreed Resolved X ><><><_><><>< Agreed Acceptable For Now X Continued Consultation Required Basic Federal- Provincial Differences 29. 30. 31. 32. . Trade” (GATT) 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. .Gun Control Legislation. . . . . . . . . . . X 54. A 55. 56. 57. SUMMARY _OF CURRENT STATUS——Continued Agreed Resolved Item IV ECONOMIC DEVELOPMENT Income Stabilization Act . . . . . . . . . . . >< -Credit . . . . . ‘. . . . . . g. . . . . . Federal Levy on Fluid Milk . . . . . . . . . . >< Deficiencies in Transportation Infrastructures . Industrial Development .. . .g . . . . . . . . ><
Environmental Concerns .
DREE . . . . . .

Proposed Federal Transportation of Dangerous

Fisheries Act . . . . . . .
Abandoned Rail Rights-of-Way .

Pay Television
Cable Licensing and Cable Distribution Systems .
Educational and Cultural Communications .
Commercial Television Advertising Regulations .
Federal Interconnection Policies
Trans-Canada Telephone System .
Video Games


Employment and Immigration (including Manpower

Labour .

Federal Court of Canada .

Prosecutorial Responsibility .
Young People in Conflict with the Law Legislation
Family Law .

RCMP Matters .

Proposed Canadian Transportation Accident
Investigation Commission . . . .

Supreme Court Intervent.ions

Referendum Legislation

For Now







. I”-3’

Part IV Mechanisms

I nlroduction

Too often in Canada today federal and provincial
governments appear to be so caught up in competing

in an adversarial manner that the business of governing
the country and its citizens suffers. Thus the Task
Force has recognized that it is not enough to merely
identify and address current areas of constitutional
intrusion or federal-provincial friction and irritation such
as those catalogued in the Task F Orce’s Report to date.
What is required is more than just short-run ad hoc
tinkering to address current concerns but the establishment
of an appropriate method to prevent or significantly
lessen federal-provincial Conflict in the long term.

What follows is a discussion of some of the mechanisms
that have been proposed to head off future irritants

and intrusions and to better the operation of the federal—
provincial system in Canada.


In Chapter IV of its June-1978 White Paper, A Time for
Action: Toward the Renewal of the Canadian Federation,
the Government of Canada made the following
commitment to improve the operation of the federal

. . . . As part of a major effort to improve
intergovernmental understanding:

(1) to take deliberate stepsto ensure that, for
its part, the federal government takes fully into
account the constitutional responsibilities and
priorities of provincial governments, by consulting
the provinces when preparing a legislative
proposal, formulating a policy, or designing a
program that is in an area of shared jurisdiction or
that could have a significant eflect—fin.ancial
or other——-on an area of provincial responsibility
or an activity within that area;
In practice, it will not be possible in every relevant instance
to consult the provinces in a manner that they would
regard as adequate. There will be circumstances,
for example, when legislation or programs will have to be
developed quickly and put in place before such consultation
could occur. It is the government’s intention that such
instances should be kept to the absolute minimum.
This statement of intent should be regarded as a standard
against which the federal government’s action can be
judged by the governments of the provinces and by
the public. The meaning of the term “significant effect”
will be established with practice and experience over time.

On June 6, 1978, shortly before the presentation of the
above-quoted Federal White Paper, Task Force
Ministers met with the Minister of State for Federal-
Provincial Relations to discuss the draft “Possible


Consultative Mechanisms with the Western Provinces to
Improve F ederal—Provincial Relations” that had

been prepared by Federal Officials and had been included
in Part IV of the Task Force’s Second Report of

April 1978 (see Annex A). 3

At the June meeting the Minister of State for Federal-
Provincial relations agreed with Task Force ministers that
the suggested “Mechanisms to Head Off Federal-
Provincial Problems” contained in the draft could be
improved by providing that the Federal-Provincial
Relations Oflice involve the provinces at an early date in
the development of federal policy and program

proposals. There was, however, no suggestion as to
precisely how this would be done or the stage at which the
provinces would be brought into the picture. It was
understood that in» some cases items would have

to go to the Federal Cabinet before the provinces could
be involved.

With respect to the question of early provincial
consultation it is the Task Force’s View that if there

are federal-provincial problems with a proposed program
or policy it is highly desirable to have them aired
wherever possible with the provinces prior to Cabinet
approval and federal government commitment. To leave
the screening process entirely to oflicials within the
Federal-Provincial Relations Office and the Minister of
State, as the proposal appears to envisage, cannot

A be viewed as a genuinely federal-provincial process;

it is essentially a unilateral federal government process.

On February 27, l.979, Task Force oflicials met with
Federal-Provincial Relations Office officials in Ottawa and
discussed further the question of appropriate
mechanisms. Federal Oflicials circulated a discussion
draft entitled “Mechanisms To Forestall Federal-
Provincial Problems And To Resolve Problems That
Arise” (attached hereto as Annex B) which reviewed the
draft mechanism put forward by Federal Officials

last year, reported on developments within the federal
apparatus since that time and suggested some additions to
the original proposal. These include:

Mechanisms to Head 01?‘ F ederal-Provincial Problems
(Problem Prevention)

Federal Ofiicials pointed out that over the past year

the Task Force exercise, along with such things as the
constitutional review and the First Ministers’ discussions
on the economy, had generally increased the sensitivity
of federal government departments and agencies to

provincial government concerns. Though progress has
been made, they recognized that continued efforts

were required to head off problems before they arise,
and in this regard pointed to an enhancement of
Federal-Provincial Relations Oflice’s capacity to deal
with these matters internally to provide more authoritative
information to the federal government on provincial
attitudes, priorities, etc. They suggested that the success
of these changes will depend, to some extent, on

the sources of information (including provincial,
intergovernmental affairs offices) that can’ be tapped.

While the western provinces are heartened by these
internal developments they note that they fall short of
the above quoted pledge made by the Government

of Canada in Chapter IV of its June 1978 White Paper,
A Time for Action: Toward the Renewal of the
Canadian Federation, to consult the provinces “when
preparing a legislative proposal, formulating a policy, or
designing a program that is in an area of shared
jurisdiction or that could have a significant effect——
financial or other—on an area of provincial ‘

As well, the Task Force encourages the Government of

Canada to increase the tendency to allow provincial

government input on federal bills that affect the provinces
before they are introduced in the House of Commons

and recognizing that if there are some Obstacles in
Parliamentary tradition to such a procedure, recommends
that consideration be given to removing that obstacle.

In addition, it encourages the practice of introducing
First Reading Bills for discussion purposes only.

Mechanisms to- Deal With Problems Once They
Have Occurred ( Problem Solving) ‘

At the February 27 meeting federal officials noted

that the mechanism they suggested last year for dealing
with problems once they have occurred has not yet been
seriously tested outside of the context of discussions
and actions surrounding the Task Force Reports.

As a possible alternative or complementary mechanism

to solving problems once they have occurred,

federal officials suggested that each western province

raise with the Federal-Provincial Relations Office the
problems they are experiencing or see arising from federal
activity as soon as the province becomes aware of

such situations. A senior federal officer has recently been

assigned to the four western provinces as his specific

responsibility and will be devoting his attention

to problem—solving. As well the Senior Adviser
responsible for the Duplication of Services exercise will
work with the senior officer in facilitating the problem
solving process.

11 THE TASK FORCE AS A .M.ri<;éiAIANisM It has become apparent that, since its estziblislii‘iieiil three years ago at Medicine Hat in April of 1976, the Western Premiers’ Task Force on Constitiitiorizil ’.’l‘i‘ei1tls has itself proved to be an effective federal~westci”ii consultative mechanism facilitating the resoliif:ioi’i of federal-provincial conflicts and to some extent in preventing them. By focusing on specific issues and monitoring progress or lack thereof on these issues anL.l reporting on them, the Task Force has motivated fetleml line departments to expedite resolution of issues ‘lllCll.lClCt.l in the Task Force Reports to date. The Task Force’s existence——the fact that it might report on new problems——-has perhaps headed these off, while concern that newly emerging problems might find their way into the Task Force’s Report has prompted federal government willingness to move more quickly to resolve them. In short, the Task Force continues to keep ‘ . both the federal and provincial line departments sensitized to federal-provincial issues. The Task Force is pleased to see that the Federal Provincial Relations Office is taking steps to Improve the consideration of and resolution of federal-provincial problems. It believes that formalizing the process by instituting regular meetings of federal-provincial intergovernmental officials once or twice a year would facilitate resolution of existing problems and provide a forum for an exchange of information on potential conflicts. It is therefore recommended that the Western Premiers’ Task Force on Constitutional Trends continue as an ongoing interprovincial mechanism to continue to . monitor federal-provincial frictions and to provide a means of resolving federal-provincial Conflict through regular meetings with federal officials and between ministers. It is further recommended that “Constitutional Trends” be a standing item on the agenda of the Western Premiers’ Conference. ‘ III POSSIBLE MECHANISMS, OTHER PROPOSALS The western provinces are hopeful that the new . . mechanisms outlined above Wlll further reduce friction and intrusions. The western provinces also recognize that there may be other, more effective ways, of addressing these ll12.fllt;l‘.‘;i. There have been a number of proposals for Consf.itLifiomi1 change presented during the last year, some of Wl’ll.(;‘-ll litfiill‘ on this exercise and merit further study. These proposals generally group around three approac.l‘ics: formalization of First Ministers Conferences, ll’lCl‘t;€.lHC:tl tl= provincial participation in the federal lawmaking process, and constitutional amendments which strengthen certain provincial responsibilities such as those over natural resources, communications and fisheries. The western provinces have not attempted to reach a consensus on which of these approaches would be most effective in reducing further intrusions. It should be noted, however, that British Columbia has been quite active in support of increased provincial participation in the national lawmaking process, primarily through a new second chamber. In their view federal-provincial Conflict could be significantly reduced by such an institutional arrangement, one which they argue would play a major part in ensuring that the views of provincial governments would be taken into account before federal action which has an impact on provincial concerns.* Other western provinces have differing views on the effectiveness of institutional or constitutional proposals. All governments remain committed to finding better mechanisms to prevent federal-provincial conflict. * See Annex‘ C for a more complete text of British Columbia’s proposal. 48 IV SUMMARY It is the Task Force’s view that the effective operation of Canada’s federal system must recognize the degree of interdependence which exists among governments. It requires a partnership approach when both areas of government are affected by decisions taken. If governments are Committed to respecting each others responsibilities and jurisdictions, they must also commit themselves to realistically assessing the impact proposed action would have on the other area of government and be willing to revise policies in light of this assessment. As such, meaningful consultation amongst governments must occur at the earliest stage possible. Consultation after a government has adopted a position, such that it is “cast in stone” is unsatisfactory. Consultation cannot always be expected to achieve agreement but, at the very least, both levels of government must be convinced that their views have been taken into account in shaping policy. ANNEX A DRAFT POSSIBLE CONSULTATIVE MECHANISMS WITH THE WESTERN PROVINCES TO IMPROVE _FEDERAL- PROVINCIAL RELATIONS Improved mechanisms should be devised: (1) to head off future federal-provincial frictions, duplication and possible constitutional intrusions; and (2) to deal with problems and grievances once they have occurred. (A) Mechanisms to Head 017‘ F ederal-Provincial Problems: FPRO should expand and intensify its review of federal policy and program proposals in their early stages of development in order to identify, and warn line departments of, potential federal-provincial problems and to ensure that the departments concerned, in each case, ask themselves: ———is the proposed policy or program constitutional? –will it duplicate, overlap or Conflict with provincial programs already in place? —what will be required to ensure adequate consultation with the provinces? On the provincial side, similar questions should be considered by provincial officials in the preparation of provincial policy and program proposals. FPRO opportunities for intervention in the policy formulation process_were described as follows: (i) FPRO desk ofiicers discuss policy proposals, at the developmental stage, with line department officials, either on a bilateral or interdepartmental committee basis; (ii) FPRO Assistant Secretary or Deputy Secretary to Cabinet can intervene at A/DM-DM level with line department if discussions as per (i) do not resolve problems, or if serious federal-provincial difficulties are contemplated in work which has arrived at an advanced stage without previous consultation with FPRO; (iii) Minister of State for Federal-Provincial Relations can review problem with his colleague from the line department before Cabinet document is finalized or before document is considered by a Cabinet committee; (iv) Minister of State could also intervene at Cabinet committee level; and (v) at Cabinet discussion of an issue. (It is clear that interventions along the lines outlined above can only be undertaken if FPRO has the facts and the capacity to make informed juclguiieiits, i.e., in substantive terms, in terms of provincial reactions and the legitimacy of such reactions.) (B) Mechanisms to Deal With Problems Once 1/112.‘ y Have Occurred: The following suggested consultative arrangements could be contemplated: (i) A federal-provincial (western) group of intergovernmental affairs ofiicials to- meet periodically to: ——review progress on existing issues; ———identify and, if possible, decide (with line departments) on action to forestall the emergence of new problems; and ———-report to ministers as deemed appropriate or necessary (federal minister and provincial counterparts). 4 (ii) A federlal-provincial (western) intergovernmental affairs group supplemented by line department officials appropriate to: ——get facts where they are incomplete or in dispute; —identify and explore differences where these are matters of principle; and —where appropriate, take action to get differences in principle discussed at the ministerial level, i.e., federal minister and his western counterparts. (iii) Ministers’ group (federal minister and counterparts) to oversee work of ofiicials, to receive recommendations from them and to intervene with their (federal and/or provincial) colleagues as appropriate. Guidelines to Improve Handling of F ederal-Provincial Issues Should Be Given Further Studies These guidelines would most probably include the following: (a) responsibility for negotiations and accomniotlami to problems would remain with the Sl1l)Sl£1T1ll.Vt3 federal and provincial departments concerned; and . (b) intergovernmental affairs Officials of one order of government would not deal with liiic I department oflicials of the other level cit’ government except in those cases Wl‘1t’;tl‘(..’i built orders of government were repi‘esent:cifl by substantive as well as intergovcrniiiitnuiil officials. ANNEX B DISCUSSION DRAFT February 21, 1979 IVIECHANISMS TO FORESTALL FEDERAL-PROVINCIAL PROBLEMS AND To RESOLVE PROBLEMS THAT ARISE Problem and Purpose of Memorandum The question of desirable mechanisms to prevent and solve federal-provincial problems was discussed between western (provincial) and federal officials early in 1978. Subsequently, a preliminary federal draft “discussion” paper on possibilities in this regard was sent to the provincial officials (see annex). Mechanisms for Lessening Intrusions is now an item on the agenda of the forthcoming (February 27, 1979) meeting of intergovernmental affairs oflicials from the four western provinces and the federal government. Therefore, this memorandum briefly reviews the “discussion” draft referred to above, reports on related developments within the federal apparatus and suggests changes or additions to the original suggestions concerning mechanisms to solve problems. Review of Present Sit.uatio-n Respecting ” the “Discussion” Draft A. Mechanisms to Head Ofi F ederal-Provincial Problems During the past yearFPRO has moved to expand and intensify its review of federal policy and program proposals, as was suggested in the “discussion” paper under the heading Mechanisms to Head 015‘ F ederal- Provincial Problems. The results of these efforts are difficult to assess. The FPRO’S View is that, despite some incidents witnessing to the contrary, increased sensitivity to legitimate provincial concern is being shown by federal agencies generally. Of course, such a change stems from a variety of influences, not just from a better day-to-day monitoring and review of developing policy and program proposals. The other activities which have been important in this regard include the constitutional review process, the duplication exercise, the frequent review of the status of the concerns I expressed by Western Premiers, and the preparatory and follow-up work related to the First Ministers’ discussions of the economy. Nevertheless, though progress has been made, sustained and increased effort to forestall the development of problems is clearly warranted. In this connection, one of the changes Stemming from a recent examination of the role and effectiveness of the FPRO is directed toward an enhancement of capacity to provide advice to 50 federal agencies, ministers and Cabinet on provincial concerns and views respecting matters of importance to the two orders of government. The success of this initiative, of course, will depend, to some extent, on the sources of information (including provincial intergovernmental affairs offices) that can be tapped. B. Mechanisms to Deal With Problems Once They Have Occurred The mechanism proposed in the “discussion” draft for resolution of problems included: (1 ) periodic meeting of western and federal (program and intergovernmental) officials to review progress, suggest action, etc., on issues raised by the reports of Western Premiers’ Task Force on Constitutional Trends; and (2) A ministers’ group to oversee the work of officials and to intervene with their colleagues as appropriate. ” This mechanism has been used to some degree for the “intrusions” exercise itself as well as for the meetings held between the Minister of State for Federal-Provincial Relations and his western counterparts, and for the constitutional review process. Nevertheless, many of the problems identified in the Reportshave been solved, or have been superseded by the constitutional review, the duplication exercise and by other events. Included in the latter would be, of course, those cases where ‘ the examination of the provincial complaints assisted the process of federal-provincial negotiation and adjustment of federal policies. The specific mechanism proposed to resolve problems has not yet been S-eriously tested, partly because other more direct means of intervention (e.g., on the part of federal program departments and ministers) were being tried initially. The meetings that h.ave taken place between officials and ministers on the Task Force Reports have been useful and, undoubtedly, have contributed to the resolution of a backlog of problems and to the development of greater sensitivity about federal activities of concern to the western provinces. Now, however, it is a question whether this approach could be complemented by another more formal mechanism to seek timely resolution of new federal- provincial problems. Possible Alternative or Complementary Mechanism to Solve Problems The best approach to problems is, of course, to prevent them from arising. However, in a federation Such as Canada, problems between the two Orders of government are inevitable. Such difficulties it is suggested, should be addressed as soon as they become apparent, in order that warranted remedies may be sought before the policy or program is fully put into place. This, in turn, suggests that each (western) province raise with the FPRO the serious problems they are experiencing or see arising from federal activity, as soon as the province becomes aware of such situations. The FPRO could then seek clarification from the department concerned, and respond quickly to the province that had raised the matter. Depending on the circumstances, a meeting of officials from the federal and provincial program agencies accompanied by intergovernmental representatives might then be arranged to canvass possible solutions and/or to explain more fully the federal action. . If these actions did not adequately deal with the problem, the question could be referred to the federal and provincial Ministers of Intergovernmental Affairs for further consideration. These ministers would have to decide whether they should involve their colleagues from the federal and provincial program agencies concerned. It is assumed, of course, that this new arrangement could be used to press for changes in provincial policies or actions which are creating problems for the federal government. F PRO Arrangements Which Could Facilitate Consultation on Solution of Problems The methods of operation of FPRO are being cliiiiigrzil to provide more authoritative information to the federal government on provincial attitudes, pl‘l0l’lll_f3tl, etc. This involves giving three relatively senior tiifliccrs responsibilities for accumulating such information, analysing it and making it available within the federal apparatus. One of these officials has been assigned the four western provinces as his specific responsibility and will be devoting some of his attention to ‘ problem—solving. I A Second operation which will facilitate the problem- solving process is the duplication exercise which in the (FPRO is headed up by a Senior Adviser-—Jennifer McQueen. The Senior Adviser in dealing with the western provinces will be accompanied in most cases by the senior officer responsible for the region as noted above. He will undertake the follow-up on problems (besides those related to duplication) which are raised by provinces. It is difficult to see at this juncture just how these two new elements will work in practice in assisting in the consideration and resolution of federal-provincial problems. However, it is certain that these new avenues of communication and information can be used to discuss difficulties and initiate action directed toward the solution of problems. 5! ANNEX C BRITISH CoLUMB1A’S MECHANISM PROPOSAL The work of the Western Premiers’ Task Force has encouraged some change in attitudes but British Columbia agrees with the Task Force on Canadian Unity that institutional reform is a prerequisite to bringing about basic and lasting change in attitudes. As the Unity Task Force stated: . . to urge people to change their attitudes is. not in itself a sufficient response to Canada’s crisis, – which is why we have gone beyond that to make proposals for institutional reform . . attitudes do not exist, nor do they change, in a vacuum. They are commonly formed in response to certain social circumstances and particular institutional arrangements. . . . It is our hope that institutional and policy reform will encourage the development of attitudes which support Canadian Unity. While British Columbia supports the con-tinuation of the federal-western consultative mechanism that is central to the work of the Western Premiers’ Task Force as outlined in the Third Report of the Task Force, it believes that, in the long term, a significant reduction of federal- provincial Conflict and intrusions can only be achieved through basic institutional changes that would make genuine federal-provincial consultation a day—to-day reality. In British Columbia’s view the “problem prevention” and “problem solving” mechanisms that have been proposed in this Report, point to a serious defect in our federal-provincial system of government in Canada that requires basic structural changes to our national political institutions. Looking at the federal proposals and pledges one is struck by the fact that there are really no institutional arrangements that obligate governments to head off future intrusions or to consult, other than perhaps a general desire to see the system of government in the country work better. Without any real compulsion the federal proposals and pledges could amount to nothing more than pronouncements of good intentions. After observing that the Constitution does not provide the provincial governments as such with any role in the composition and functioning of national political institutions and in national policy-making, Professor D. V. Smiley states that: The most critical areas of Canadian public policy are now within the realm of federal~provincial decision. Yet the Canadian federal system has developed little institutional capacity for giving authoritative resolution to conflicts about these matters. It is the serious and manifest need for such an “institutional capacity for giving authoritative resolution” 52 to day-to-day federal-provincial conflicts which has led both the federal and certain of the provincial governments to put forward explicit proposals for an institution that would build provincial government participation and authority into the Structure of national policy-making. Indeed The Task Force on Canadian Unity, in its report of January 1979, saw as the best way to reduce intergovernmental Conflict in Canada building into the Parliament of Canada: “an institution which could play a major part in ensuring that the views of provincial governments are taken into account before any central action which might have an impact upon areas of legitimate provincial concern occurs, thus inducing more harmonious federa.l—provincial relations.” A new second chamber of the federal parliament is central to the constitutional proposals put forward by the Province of British Columbia. The main purpose of the proposed second chamber would be to act as a mechanism whereby the national government would be adequately informed of, and take into account the needs and aspirations of the different provincial governments in initiating laws having crucial provincial import. I The essential elements of the proposal are that a member of the Executive Council of each provincial government would be the leading representative of that province in the new institution, with prime voting authority with respect to specified matters of crucial interest to the provinces and, that this federal-provincial government institution would have an absolute veto I on matters of crucial interest. The fact that a member of the Executive Council from each provincial government would be the leading spokesman of that province in the new institution would give the provincial governments direct input into the national lawmaking process with respect to crucial federal-provincial issues that is sorely lacking today. ’ The (policy needs of the provinces at the federal level vary « from province to province and a provincial forum at the centre is necessary to address those needs. The veto power would seldom likely be used. But the ’ very existence of the veto power would spark the desired degree of consultation at an early stage. In order to avoid the exercise of the veto, consultation and resolution of federal-provincial conflicts especially on issues o_f importance to the provinces would take place at the early stages of policy formation. A built-in institution such as is proposed, acting as an ongoing mechanism would compel consultation and co-operation between governments and would provide early provincial government input into the policy-making process thus providing the ideal means to head off day-to-day federal-provincial conflict and intrusion in the long term while‘ at the same time ensuring that the views of all constituent members of the ft:tleir:1l;icm are brought to bear on the development of nati.(:>t1:;1l
(as distinct from federal government) policies.

Such a mechanism could not but have the ellcct tiff
markedly improving the operation of federalmprotvixmizulxi
relations in Canada and has a potential to proximtcz
national unity to an unprecedented degree.

Part V Duplication of Services


At their annual meeting in August 1978, the 10
provincial Premiers expressed grave concern about the
degree of duplication of services by the two orders of
government in Canada. Their communique stated that
“The Premiers, recognizing the negative impact

that duplication of government functions and
overregulation have on the economy of the country and
on the daily lives of Canadians, today called for
immediate action to lessen overlapping of government
services and regulation.”

Moreover, at their annual meeting, the Premiers
emphasized that duplication in many fields has been
caused by the intrusion of the federal government into
areas of provincial jurisdiction. The Premiers identified
nine areas of duplication which should receive

immediate priority by the federal government:

—-consumer and corporate affairs
——environmental protection
——agricultural research
——offshore mineral resources
——regulation of uranium mining and the nuclear
industry .
——housing and urban affairs
—-—administration of justice
——correctional services
—-post-secondary education.

The issue of duplication was discussed by the Continuing
Committee of Ministers on the Constitution at

Mont Ste-Marie, November 23-25, 1978. The ministers
agreed that:

(1) work on eliminating duplication of government
services should proceed immediately;

( 2) work on this matter should be carried out
by operational departments;

(3) federal-provincial consultation could take
place on a bilateral or multilateral basis
depending on the circumstances;

(4) Ministers of Intergovernmental Affairs and First‘

Ministers should supervise the work to be
carried out.

Since that time, oflicials from the F ederal—Provincial
Relations Office (FPRO) have visited all the provinces in
an attempt to determine the specific items of duplication
that should be pursued within each broad issue area.

At the First Ministers’ Conference, February 5-6, 1979,
the federal government released a short statement
outlining the work being done on the issue of duplication


and tabled a general document which summarizes

FPRO.’s findings in the nine priority issue areas. The
general thrust of the federal government’s position

on this issue suggests that the duplication exercise

is useful and that they should concentrate on specific
issues. It also suggests that concrete results should be
made on a short list of specifics before that list is expanded
to include duplication in new issue areas.

F ederal—Pr0vincial A cti viti es

The federal-provincial activities to examine duplication
of government services on the nine priority areas
can be summarized as follows:

In the area of consumer and corporate affairs, the
federal and provincial governments are pursuing a joint
program to identifyproblems of duplication. A series
of bilateral meetings has taken place between federal
government oflicials and oflicials from each of the
provinces. A report to Consumer and Corporate Affairs
Ministers indicating that some progress has been made

is now being prepared and will be circulated in a

few weeks. This report will be tabled, for discussion

and future action at the annual meeting of Ministers of ’
Consumer and Corporate Affairs, scheduled for mid-1979.

In the area of environmental protection, the federal
government has announced that it plans to address
provincial concerns and to reduce duplication in this

area through the joint development of a new environmental
protection strategy. The federal role in this strategy

will focus on matters related to specific federal
responsibilities. Provincial governments will be delegated
responsibility to administer federal regulations wherever

Federal and Provincial Ministers of Agriculture agreed,
at a meeting in November 1978, that duplication

was not a problem in the agriculture research field at
present. Moreover, it was agreed that existing channels
of communication prevent wasteful duplication and
provide a satisfactory basis for communication and
co—ordination between governments.

Regarding offshore mineral resources, the issue is based
on a jurisdictional dispute which is being addressed a

in the ongoing constitutional review discussions. However,
on the West Coast, between Vancouver Island and

the Mainland, jurisdictional debate concerning submerged
lands is presently before the courts. A Court of Appeal
decision in favour of the Province of British Columbia is
presently being appealed by the federal government.
Discussion regarding duplication in this area will likely

await the outcome of the appeal. While these jurisdictional
disputes await an outcome, administrative arrangements
should reduce duplication.

Concerning the regulation of uranium mining and the
nuclear industry, the federal government has promised to
consult with the provinces before reintroducing bills
affecting these areas. In the related field of health and
safety of workers in uranium mining and the nuclear
industry, bilateral administrative arrangements are being
worked out to avoid duplication.

Perhaps the largest amount of progress in eliminating
duplication of services by the two orders of government
has been achieved in the area of housing and urban
affairs. The disbanding of the Ministry of State for Urban
Affairs has substantially met the concern of the provinces
that the federal government was operating in a field

of provincial jurisdiction. Progress in a number of related
areas of duplication has taken place. Moreover, a

federal document, tabled at the February 1979 First
Ministers’ Conference, seeks agreement to establish
bilateral intergovernmental committees in each province,
composed of representatives from Central Mortgage

and Housing Corporation and the various provincial
housing ministries.

Discussions in the field of the administration of justice
and correctional services began with the formation

of a Federal-Provincial Steering Committee of Deputy
Ministers. In addition to the progress made by

the Steering Committee, bilateral meetings have been
under way in a number of subareas within the broad fields
of justice and correctional services.

Duplication in the field of post-secondary education

is mainly restricted to vocational training. Specifically,
duplication has been identified in the field of vocational
counselling and certain administrative areas. The if
federal government, through the Employment and
Immigration Commission, has promised to consult with
the provinces in order to remove these and other irritants
between the two orders of government.

Evaluation of the Duplication Process

The western provinces are encouraged that the need
to. eliminate duplication has been recognized by
the federal government and that the exercise is well under

way. Much of the initiative for this pl.’(‘i)(.‘.4’;‘.3:4..‘$ was,

no doubt, created by the explicit inventory of
government intrusions into areas of pi‘ti)vim;:i31l jtllii§:‘.i.ii£;j!11
described in the two reports of the Western I’in11r1ini*a’
Task Force on Constitutional Trends. In Iimty il’l§il§iil(:fE?>%i,
these intrusions caused a duplication of servitzeii,

but more importantly, the thrust of the reports was to
create an increased sensitivity by the federal gi)VGl’l‘ll)li§lIl.
to the provinces’ rightful areas of jurisdiction.

To date, the federal-provincial discussions to Ciifl‘…‘:-
duplication have been limited to the nine priority

areas agreed to by the First Ministers. i Some prognfrzss Inn;
been made to date, and signs point toward further
progress in these areas.

In a communique at their last annual meeting, the
Premiers stated that “concrete remedial action should be
taken by the end of the year.” The year 1978 has

passed, and sustained effort to eliminate duplication in

the remaining areas must be made in order to bring

results in the weeks and months ahead. Moreover, the
commitment to eliminate duplication must be a permanent
one, and as soon as it is practical, the process must

be expanded to eliminate duplication in all services
p.rovided by governments.

Several of the mechanisms in pl-ace now have successfully
eliminated a good deal of duplication. For example,
Consumer and Corporate Affairs officials have eliminated
duplication through negotiations of the Permanent
Committee of Deputy Ministers and Federal-Provincial
task forces. It is to be hoped that these and similar
mechanisms will be able, in the future, to head off
duplication and other irritants before they arise. This
should be the larger and ultimate goal of the duplication
process and the mechanisms put in place to avoid

The process, in many instances, involves an issue-oriented,
bilateral approach between operational departments.

All of the activities will need to be monitored by the
respective Intergovernmental Affairs officials to ensure the
process is adequate in each instance. It is recommended
that the duplication of services exercise be a subject

‘of discussion at the Annual Premiers’ Conference for

review of the progress to date.

Part Communique and Letter of Transmittal to p
Prime Minister

Province of British Columbia

Prince George
British Columbia

March 27, 1979

The Right Honourable Pierre E. Trudeau,
P.C., Q.C.
Prime Minister of Canada

My’Dear Prime Minister:

On behalf of the Western Premiers, I am pleased to forward two copies
of the “Third Report of the Western Premiers’ Task Force on Constitutional Trends”
tabled during our annual conference ‘held in Prince George, British Columbia.

You will see from this Report that it is the view of the Western Premiers that the

federal-western consultative process initiated by the First and Second Reports

of this Task Force has had some positive results in sensitizing the

federal government to legitimate western concerns. Although it is noted that close

to one-half the concerns raised in the earlier reports have been resolved, or at

least have become of somewhat less immediate concern, the Premiers stress that efforts
to reduce federal/ provincial conflicts must continue since many other important

issues remain unresolved.

The Western Premiers hope that efforts by our governments to address these problems
will be accelerated in the future and that suitable mechanisms can be put in place to
prevent these kinds of concerns arising in the first place. I

I look forward to hearing from you.

Yours very truly



cc:—-—The Honourable Marc Lalo-nde
The Honourable John Reid

Communique No. 3


The Western Premiers have today received and
considered the Third Report of the Task Force on
Constitutional Trends, containing a current status report
on the issues identified in the previous reports, an
evaluation of recent federal efforts to reduce federal—
provincial duplication, and a discussion of some of the
mechanisms that have been proposed to head off

future irritants and intrusions.

Ministers on the Task Force are the Honourable

K. Rafe Mair, Minister of Environment, British Columbia,
Chairman; the Honourable Dick Johnston, Alberta
Minister of Federal and Intergovernmental Affairs; the
Honourable Roy Romanow, Saskatchewan Attorney-
General; and the Honourable Gerald Mercier,

Manitoba Attorney-General.

The Western Premiers view the federal-western
consultative process initiated by the publication of the
First and Second Reports of their Task Force on
Constitutional Trends as having some positive results in
sensitizing the federal government tolegitimate western ’
concerns. They are encouraged that close to half

the concerns raised in the previous reports have been
resolved, or at least have become of somewhat less
immediate concern.

At the same time, the Premiers are aware that efforts

to reduce the potential for federal-provincial conflicts
must continue since many other important issues remain
unsolved. Moreover, during the past year, there

have continued to be instances where the federal govern-
ment failed to take provincial concerns and input

into account when initiating policies affecting both orders
of government. The lack of consultation prior to

the introduction of the federal spending cuts and the
Energy Supplies Emergency Act,‘ I 979, are examples of
such federal actions. « I

The Western Premiers note that the First Ministers’
Conferences on the constitution and on the economy,
along with the related follow-up activities to these
Conferences, such as national efforts to reduce duplication
of services and regulatory burdens and the private

sector consultative task forces in a number of industrial
sectors, have coincided and are in part attributable

to the western provinces’ ongoing review of constitutional
trends. As such, many of the concerns raised by the
Task Force are also being considered in these other
contexts. The lack of meaningful federal-provincial
consultation, the main theme in the Task Force Reports
on Constitutional Trends,.has also become the focus

of many other federal-provincial discussions.

The Western Premiers emphasized that the Task Force
will continue as a mechanism to lessen federal
constitutional intrusions, duplications and tensions

in the future. As part of this process, the Task Force will
monitor and analyse federal activities of concern to

the western provinces. The Premiers agreed

that constitutional trends would be a standing agenda
item at their annual conferences. They believe that

the federal / provincial dialogue which is afforded by the
Task Force is a positive step toward improving the
operation of the federal system.

While it is unreasonable to expect that there will not be
any disagreements between the federal and western
provincial governments in the future, they feel that this
consultative process will provide the means to forestall the
development of federal-provincial problems as well

as resolve conflicts once they have occurred.

Premier William Bennett of British Columbia,

on behalf of the Western Premiers, has forwarded a

copy of the Third Report to the Prime Minister of Canada
and the Minister of State for F ederal-Provincial


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