Western Premiers’ Task Force on Constitutional Trends, Second Report (April 1978)


Document Information

Date: 1978-04-06
By: Western Premiers’ Task Force on Constitutional Trends
Citation: Western Premiers’ Task Force on Constitutional Trends, Second Report (1978).
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Report of the
Western Premiers’
Task Force on
Constitutional Trends

May 1977


Foreword

At their annual meeting held in April 1976 the Premiers of the four Western Provinces shared a common concern over the increasing tendency, perceived at that time, of the Government of Canada initiating federal legislation in subject areas which historically and constitutionally have been considered tobe within the Provincial sphere.

The Western Premiers established a Task Force of Ministers, chaired by British Columbia, to prepare a detailed inventory of these apparent intrusions and to make recommendations with respect to them. This Report represents the findings of the Task Force.

At their meeting held in Brandon, Manitoba, on May 5 and 6, 1977, the Western Premiers received the Report and agreed that it be forwarded to the Prime Minister of Canada in the hope that these outstanding federal-provincial grievances might be the subject of further consideration by all governments.


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Report of the
Western Premiers’
Task Force on
Constitutional Trends

May 1977

Contents


Part I PAGE No.
Introduction 7
Inventory of Federal Instrusions 8
Recommendations 9
Part II
Comment on Study Papers 17
Consumer and Corporate Affairs 18
Resources 25
Housing, Urban Affairs, and Land Use 29
Economic Development 33
Communications 36
Demography and Immigration, Manpower and

Training, Labour 42
Administration of Justice 46
Interventions by Government of Canada before the Supreme Court of Canada 50
Appendices
1. Letter of transmittal to Prime Minister of Canada 52
2. Communique from Western Premiers’ Conference 53


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PART I

Introduction

1. Background

The Western Premiers’ Conference, held in Medicine Hat on April 28, 197 6, released a communique on constitutional matters which read in part:

Concern was expressed by the Premiers with regard to recent federal legislative moves into areas of provincial constitutional jurisdiction. Such moves include federal legislation and proposals in areas such as: securities, mutual funds, electronic payments systems; telecommunications and cable systems; as well as certain areas of competition policy and consumer protection.

It was agreed that these possible federal intrusions called for a careful and co-ordinated analysis by the western provinces.

Accordingly, an intergovernmental Task Force was established to prepare a detailed inventory of these federal activities and to make recommendations to the next Western Premiers’ Conference for their consideration.

2. Formation of the Task Force

The Honourable K. Rafe Mair, Minister of Consumer and Corporate Affairs for British Columbia was the Task Force Chairman; The other members of the Ministerial Task Force were the Honourable Lou Hyndman, Alberta Minister of Federal and Intergovernmental Affairs, the Honourable Roy Romanow, Saskatchewan Attorney-General, and the Honourable Ian Turnbull, Manitoba Minister of Consumer, Corporate and Internal Services. Mr. Turnbull’s representation on the Task Force was recently assumed by the Honourable Howard Pawley, Attorney-General for Manitoba.

3. Methodology

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

1. Consumer and Corporate Affairs.
2. Resources.
3. Housing and Urban Development.
4. Economic Development.
5. Communications.
6. Immigration, Manpower, and Labour.
7. Administration of Justice.
8. Interventions by the Government of Canada before the Supreme Court of Canada.

Concerns pertaining to finance, Human Resources, Education, and Health were not considered by the Task Force.

The results of the questionnaire were analysed and and Task Force ofiicials 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. Western Task Force Report

The Western Task Force Report is in two parts. Part I consists of this Introduction; an inventory of federal intrusions; and a summary of the findings and recommendations of the Task Force.

Part II consists of the eight Western Task Force Position Papers, which detail the intrusions, describe the impact of these intrusions on provincial programs, their relation to federal policy, federal-provincial consultations in the area, and provide the rationale for the suggested provincial positions.

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Inventory of Federal Intrusions

I. Consumer and Corporate Affairs

1. Borrowers’ and Depositors’ Protection Act
2. Competition Policy (Stage 2)
3. Bank Act 1977
4. Electronic Payments Systems
5. Trade Practices
6. Bankruptcy Act
7. Proposed Mutual Funds Act and Securities Act

II. Resources

1. Renewable Resources
—National Forestry Policy
2. Nonrenewable Resources
a. Resource Taxation
—Non-deductibility of Royalties
b. Pricing
i. Petroleum Administration Act
ii. Ten Cent Excise Tax on Gasoline
c. Supply and Disposition
i. National Energy Board Act
ii. Emergency Supply Allocation Act
iii. Federal Government Legal Intervention
re: Saskatchewan Potash
iv. “Canada First” Policy
d. Resource Appraisal Programs
e. Research and Development Program
f. Mineral Policy Objectives
g. National Coal Policy

III. Housing, Urban Affairs, and Land Use

1. Direct Federal Grants to Municipalities
2. Housing Programs (AHOP, Assisted Rental Programs)
3. Urban Land Development Programs
4. National Guidelines for Land Use
5. Aeronautics Act Amendments
6. Flood Hazard Reduction Program

IV. Economic Development

1. Agriculture
a. Income Stabilization
b. Credit
c. Federal Levy on fluid Milk
2. Transportation
a. Rail Relocation
b. Rail Line Abandonment
c. Freight Rates
d. National Transportation Act Changes
e. User-pay Philosophy Emphasis
f. Federal Public Transport Policy

3. Trade
—General Agreement on Trade and Tariffs
4. Industrial Development
a. Development of federal strategies for several industrial sectors (e.g., fertilizers, petrochemicals, foundries, steel, rapid transit)
b. Lack of federal initiatives in assisting small businesses
5. Environmental
a. National Water Pollution Guidelines
b. Federal Environmental Studies
6. DREE

V. Communications

1. Telecommunications
a. Cable Television
i. Pay Television
ii. Master Antenna Television Systems
iii. Cable Licensing Decisions h
b. Cable Distribution Systems
2. Educational and Cultural Communications
3. Commercial Television Advertising Regulations
4. Federal Interconnection Policies

VI. Demography and Immigration, Manpower
and Training, and Labour

1. Demography and Immigation
a. National Demographic Policy
b. Immigration Bill a
2. Manpower and Training
a. Community Employment Strategy
b. Adult Occupational Training Act.
c. Apprenticeship Program
3. Labour
—Papers Respecting the Post-Control Period

VII. Administration of Justice

1. Federal Court Act
2. Prosecutorial Responsibility
3. “Young People in Conflict With the Law” Legislation
4. Family Law
5. “Peace and Security” Package
6. RCMP Matters
a. RCMP Expansion
b. Marin Commission Report

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

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Recommendations

I. Consumer and Corporate Affairs

The Task Force expressed concern that proposed federal instrusions 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.

The Task Force made the following comments and recommendations :

1. The Borrower’s and Depositor’s Protection 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 he 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 (Stage 2)

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 legislation’s constitutionality should be explored by provinces. Provincial and regional development should also be recognized asa factor in arriving at national policy decisions.

3. 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 the adequacy of the federal response to provincial concerns.

4. 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 be sought.

5. Trade Practices

Concern was expressed that the federal government intends to develop its own Trade 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.

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 berecognized 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 operations.

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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 centred around the natural resource sector. Various federal initiatives, especially since the energy crisis in the fall of 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.

The Task Force outlined their concerns in these areas and made the following recommendations:

1. Renewable Resources

National Forestry Policy—The 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 Environment Ministers), in order that legitimate areas for federal involvement could be closely defined.

2. Nonrenewable Resources

a. Nondeductibility of Oil and Gas Royalties—The 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 have on a province’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 govemment’s attempts to diversify economically.

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.

c. Ten Cent Excise Tax on Gasoline—The federal government’s ten 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.

d. 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.

e. 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.

f. Federal Government Legal Intervention re: Saskatchewan Potash—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.

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

g. “Canada First” Policy—The stated “Canada First” policy of the federal government with respect to export of nonrenewable resources and the ultimate concept 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 govemment’s ultimate control over these matters, they felt that the various provincial responsibilities and needs should be more adequately recognized.

h. Resource Appraisal Programs—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 in 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 initiatives in sponsoring research involving provincially owned resources. 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. Phases I and II of a 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 could 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 discussions.

k. 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 ofthe 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 reaflirm 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.

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 governments.

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 advance of any legislative changes related to housing or urban affairs.

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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 governments.

2. Housing Programs (AHOP, 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 better policy co-ordination between the federal-provincial and the provincial-municipal levels be a priority for all levels of government.

3. 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 process for 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.

4. National 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 responsibility.

5. 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 of airports. 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.

6. 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.

IV. Economic Development

Recent developments within the 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 aspirations of central Canada. Both the federal and provincial governments have legitimate responsibilities within the field of economic development. On various fronts, federal actions seriously affect the direction of provincial development. In general, federal intrusions in the economic development field take the form of federal actions which limit the scope for independent provincial programs and policies.

The Task Force recommended that there be an increased co-ordination of effort between the federal government and the western provinces to develop viable agricultural and industrial development strategies for western Canada. More provincial input into national economic decision-making is needed. This could be undertaken in a variety of ways and in a number of areas.

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 govemment’s delay in rectifying the situation surrounding

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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.

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

2. Transportation

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

3. Trade (GATT)

Although the federal govemment’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 with the reduction’ 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 govemment’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 businesses, 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 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 provinical responsibility for application and enforcement would resolve most conflicts.

6. DREE

The potential for a conflict between DREE activities and provincial priorities exists. With this in mind, the Task Force agreed that there must be recognition that the provincial governments retain primary responsibility for establishing the priorities for economic development. All DREE sub-agreements should reflect provincial priorities. To ensure compatibility 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.

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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 communication policy field.

The Task Force made the following comments and recommendations:

1. Telecommunications

a) Cable Television—The federal government, through the extension of its authority under the Broadcasting Act, has proposed a policy toward pay television which will involve federal regulation of closed-circuit entertainment services provided by coaxial cable. Recent actions taken by the Canadian Radio—Television and Telecommunications Commission (CRTTC) regulating Master Antenna Television Systems and Cable television licensing have also expanded federal control over cable communication 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 and Saskatchewan 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.

2. Educational and Cultural Communications

The federal government’s attempts to impose a definition of “programming” on the provinces would restrict a provincial government’s use of communications technologies to deliver social, educational, and cultural services to the public. The Provinces of Alberta and Saskatchewan agreed that educational communications carried out by means of cable or wire technology should be exclusively a provincial concern. British Columbia was sympathetic to this position. Manitoba had alreadysatisfactorily resolved this issue with the federal government through their agreement on programming and carrier ownership.

3. Commercial Advertising Regulation

The CRTTC’s steps to regulate commercial television advertising 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-à-vis broadcast licensees be considered, provided the federal government enters into bilateral arrangements in this regard.

4. Federal Interconnection Policies

The federal gbvernment’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 recommended the provinces continue to oppose any federal moves encouraging these actions, which would diminish the provinces’ control over their telecommunications carriers, and which result in a deterioration of levels of service to remote and rural areas. British Columbia was sympathetic to these views.

VI. Demography and Immigration, Manpower,
and Training, and Labour

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.

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The Task Force recommended co-operation with the federal government in developing 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 be sought. 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.

3. Labour.

Until recently, provincial labour policy has been relatively free from federal influences. But, with the publication in the fall of 1976 of Labour Canada’s 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 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 onprovincial 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 reflecting 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 a justice represent a pervasive federal interest 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 justices (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.

The Task Force’s concerns’ and recommendations with respect to the administration of justice are:

1. The 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 a criminal and civil jurisdiction appear to be unconstitutional. The purported jurisdiction of the Federal Court has serious practical disadvantages to the administration of justice in the province and to the citizens of v 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.

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2. 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 Officials of Alberta, British Columbia, and Saskatchewan 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.

3. “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 official position but raises the issue to express their concern.

4. Family Law

Developing federal, intrusions in the area of family law included 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 is 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.

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

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.

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 provincee 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.

VIII. 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 tothe 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.

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PART II

Comment on Study Papers

The work of the Western Task Force identified the present or potential areas of friction between the federal government and the western provinces arising from recent federal intrusions into areas of provincial competence and jurisdiction.

The Task Force members were of the general opinion that all too often federal initiatives have been either unilaterally developed, unappreciative of legitimate provincial interests and regional aspirations, and developed without adequate consultation with the provinces. In too many instances, theTask Force noted, the federal government has been too ready to identify an over-riding nationaldimension in what appears to be an unending list of policy concerns. This tendency toward a national presence for its own sake, in the view of the Task Force, has lead to the emergence of an unnecessarily large number of “friction points” with many of the western provinces.

In releasing their findings and recommendations, the Task Force hopes that public awareness and discussion on this important aspect of federal-provincial relations might be promoted. The subject areas are specific and concrete. It is the hope of the Task Force that a constructive dialogue about these problems might be undertaken between the federal government and all the provinces.

The study papers, considering the large number of topics covered, are not expected to convey unanimous findings or recommendations by the participating governments. However, it will be seen that there is a high degree of consensus in the papers, most particularly in those concerned with Housing and Urban Development, Immigration, Administration of Justice, and Economic Development. In the case of Resources, Communications, and Consumer and Corporate Affairs, substantial agreement by amajority of the western provinces should be noted.

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Consumer and
Corporate Affairs

Summary

The general area of consumer and corporate affairs has been the source of increasing friction between the provinces and the federal government in the past several years. Immediate indications are that this situation will continue for some time, which is to be regretted.

The federal initiatives are many and varied and point to a significant national thrust into market and economic regulation which has important implications for regional and provincial interests.

Proposed consumer credit legislation, Bill C-16 (Borrowers’ Depositors’ Protection Act), Stage II of the new national Competition Policy and proposals for the Bank Act 1977 head the list of provincial concerns. Closely following behind are the forecasted federal programs in trade practices legislation, electronic payment systems, securities and mutual funds legislation and, to some extent, the proposed new Bankruptcy Act.

In general terms, the western provincial position, having recognized the integrated and inter-related nature of many of the federal developments, is to point out their insensitivity to provincial laws and priorities, to question publicly the need for some of the programs, and in the principal areas, to call for a moratorium on the federal steps in order that immediate discussions can be held with the provinces to identify a more satisfactory plateau for federal activity in these areas.

I. Federal Intrusions/Initiatives

1. Bill C-16, Borrowers’ and Depositors’ Protection Act

This is a major, omnibus Bill which has now received Second Reading in the House of Commons. If enacted, Bill C-16 will lead to a considerable dislocation of provincial mortgage, trade practices, and consumer credit legislation. It will also establish a national regulatory presence for all financial institutions, including retail credit grantors, provincial credit unions, and provincial treasury branches. While individual provinces have voiced support for some of Bill C-16’s provisions and goals, there is considerable apprehension about the degree of overlap and conflict between Bill C-16 and existing provincial legislation which, in many cases has been in force for over a decade.

2. Bill C-42, Competition Act

The forecasted introduction of a new Competition Act came true on March 16 when first Reading was given to Bill C-42. If the Bill becomes law, a national Competition Board will be established and it will have a broad range of powers touching upon corporate market conduct. In addition to some significant concerns by several of the provinces about the constitutionality ofthe exercise, there is apprehension about the suitability of nationally determined criteria for economic and market questions where very important provincial and local development priorities ought to be taken into account. While it is admitted that the provincial Attorneys-General have been given a right of standing to make representations to the proposed Competition A Board, the Bill does not direct the Board to give any weight or significance whatsoever to provincially oriented representations. Indeed, the language of the Bill suggests that national considerations have a monopoly in the decision-making process of the Board, an unnecessarily rigid and insensitive direction.

3. Bank Act 1977

The proposals for the Bank Act 1977 would create a direct federal jurisdiction over chequing institutions “under provincial jurisdiction, including credit unions/caisses populaires, some trust and mortgage loan companies and, in the case of Alberta, treasury branches. These institutions will be required to belong to a new Canadian Payments Association (CPA) either directly, or through membership of centrals. Requirements attaching to this membership would include:

a. Reserve requirements consisting of Bank of Canada notes or non-interest-bearing deposits with the Bank of Canada.

b. Information to be supplied to the federal Inspector-General of Banks; and supervision of the CPA by the federal Minister of finance.

4. Electronic Payments Systems

Anticipated federal developments are the subject of some provincial concern in their effects on existing consumer and commercial legislation, the strength of provincial regulatory control over locally incorporated financial institutions. and possibly adverse effects on the competitiveness of those institutions vis-à-vis more national entities. The proposals for a centralized electronic clearing mechanism for deposit-taking institutions obviously

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are linked to the preceding proposal for the establishment of a Canadian Payments Association. It is still unclear exactly what form the electronic payments system (EPS) would take, although it will have great significance for the nature and the role of the CPA.

5. Trade Practices

Amendments to the Combines Investigation Act, proclaimed in 1975 and 1976, enhanced the potential for conflict and overlap with trade practices legislation presently in effect in Alberta and British Columbia and the subject of a White Paper in Saskatchewan. Future development, of more federal trade practices legislation is very likely. British Columbia, Alberta, and Saskatchewan do not feel that further federal legislation is necessary in view of the very comprehensive provincial legislation already in effect or proposed for early introduction.

6. Bankruptcy Act

The exact impact of the forthcoming new Bankruptcy Act on debtor assistance programs, at least in Alberta and British Columbia, and on provincial law governing debtor-creditor relations generally is a subject of continuing interest, and some concern.

7. Proposed Mutual Funds Act and Securities Act

These are two matters of considerable concern given their prospects for establishing two levels of government as regulators and intervenors.

II. Impact on Provincial Policies and Programs

1. Bill C-16, Borrowers’ and Depositors’ Protection Act

There is a very real potential for substantial conflict and (or) overlap with existing provincial legislation governing consumer credit, mortgages and agreements for sale, unconscionability, contracts, trade practices, and financial institutions. The prospects for constitutional challenge arising from commercial litigation are very high and one of the results will be a rather lengthy period of uncertainty about the legality of Bill C-16 and a large number of existing provincial statutes. Very important questions concerning the administration of Bill C-16, with or without provincial involvement, have yet to be resolved and on the regulatory side, there are strong prospects for distortions, conflict, and gaps in the administration of credit legislation.

2. Bill C-42, Competition Act

The full impact of Bill C-42 on provincial policies and programs has yet to be properly assessed, in view of the fact that Bill C-42 was only given first Reading on March 16. However, as noted above, the constitutionality of the federal proposals, particularly under the heading of property and civil rights, is open to challenge. At this time, another principal concern is that the proposed Competition Board will not be under any duty to consider provincial or local economic factors in making its rulings. In a nation as large and diverse as Canada, it is inconceivable that some sort of national, monolithic concept of competition is either suitable or applicable to regulatory decision-making having such a direct impact on local, regional, and provincial economies.

3. Bank Act 1977

A number of specific concerns were communicated to the federal Minister of finance by his provincial counterparts in early December 1976.

In a more general sense and very significantly, the relationship between the provincial governments and the financial institutions under their jurisdiction would be fundamentally altered and the role that these institutions could play in the social and economic development of the provinces would be diminished. These changes would be reinforced by other proposed measures to extend the functions, and thus the competitive strength, of the chartered banks. The proposed revisions would effectively transfer the responsibility for maintenance of liquidity from the provincial government to the federal Minister of finance and for the maintenance of solvency to national institutions. In addition, the White Paper implies that the reserve requirements are to be determined according to the criteria of national monetary policy, in spite of the fact that such policy at any given time may be quite inappropriate for particular regions or provinces. While provincial near-banks I would benefit from participation in the national clearing system, they could be placed at a financial disadvantage by the additional costs involved in terms of reserve requirements and possibly

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also disproportionate costs attached to participation in the CPA or EPS (althoughthese have not yet been determined). The White Paper reflects a federal attempt to absorb provincial deposit-taking institutions into a national system and would undermine important relationships between such institutions and the provincial jurisdictions that created them. There is little reason to believe that the proposed banking regime will be more responsive to regional capital needs, local development priorities, or local needs in a broader sense than the purely financial.

4. Electronic Payments Systems

Provincial concerns are in a very formative stage but basically there is apprehension that the EPS will interfere unduly with provincial policies in communication systems, debtor-creditor relations, consumer credit, human rights and privacy, contracts and jurisdiction over provincial financial institutions.

5. Trade Practices

While the federal proposals have not yet been placed in writing and are directed toward the alleged goal of maximum legislative uniformity, there is concern that federal legislation could easily lead to overlap and conflict with legislation presently in place in British Columbia and Alberta and proposed for Saskatchewan.

6. Bankruptcy Act

Although recent federal provincial discussions have clarified matters to a degree, there is still a lack of certainty about the probable effects of forthcoming bankruptcy legislation on provincial legislation in debtor-creditor relations and on existing provincial programs (at least in Alberta and British Columbia) offering counselling and payment plans for consumer debtors.

7. Proposed Mutual Funds Act and Securities Act

Provincial programs in these two areas have been in place for some time and there is a very good record of interprovincial co-operation in maintaining a high level of uniform administration. The advent of proposed federal legislation poses the obvious potential for duplicative and conflicting regulation.

III. Relation to Federal Policies and Programs

1. Bill C-16, Borrowers’ and Depositors’ Protection Act

Bill C-16 is a very comprehensive, if not over-reaching, measure which purports to cover every aspect of consumer credit, interest rate calculations, mortgage payments and prepayments, income tax rebating, loan sharking, credit advertising and credit cards. linked to the recent amendment to the Combines Investigation Act, the proposals for a new Bank Act and the development of an Electronic Payments System, the BDPA is an integral part of an all-encompassing federal attempt to regulate most features of the credit-payment-financial institution system.

2. Bill C-42, Competition Act

The federal proposals involve the creation of a Competition Board which is empowered to review and rule upon the legality of a broad range of business conduct deemed to be anti-competitive under the terms of the Bill. The Board’s creation is in line with the federal propensity toward setting up regulatory schemes in areas of perceived national interest. The Bill states that the Federal Court initially will have sole jurisdiction over class actions launched under the Act, although provision is made for concurrent jurisdiction to be extended by proclamation to any superior court upon conclusion of the necessary agreements with the Attomeys-General of the provinces. The Bill has been described by the sponsoring Minister as “an essential element in the long-term a structural policies outlined in the government’s working paper of October 1976, The Way Ahead.”

3. Bank Act 1977

The White Paper described the federal proposals as a co-ordinated effort to ensure a high level of competition and efiiciency among Canada’s financial institutions. The White Paper proposals concerning near-banks appear to relate to a federal effort to centralize control of financial institutions, with two main concerns in mind, i.e., a national monetary policy and the development of an Electronic Payments System. Although it is argued that the growth of near-banks threatens to jeopardize the effectiveness of national monetary policy, public statements of the present Governor of the Bank of Canada and his predecessor have stated that the near-banks do not frustrate national monetary policy. Moreover, the possibility that the near-banks would expand relative to the chartered banks and thereby upset this balance has

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not happened. The chartered banks’ share of total assets increased from 41 per cent in 1967 to 46 per cent in 1975, during which period the near-banks’ share fell from 41 per cent to 32 per cent. While it may be argued that the formation of a national Payments Association would be necessary for the introduction of EPS, the latter does not require the centralization of power over financial institutions which is proposed in the White Paper.

4. Electronic Payments Systems

The proposals for EPS are closely tied to federal rmtratives in the areas of competition law, possibly securities regulation, and certainly the proposals for a revised Bank Act (including the suggested Canadian Payments Association). The federal structuring of study committees (3) has been the subject of complaint and criticism by all four western provinces. Federal-provincial discussions are resuming but the matter is in a state of flux at the moment. In view of the widespread implications for the provinces of EPS, its design and implementation should be a joint federal-provincial exercise in the truest sense.

5. Trade Practices

There are recent indications that the federal government intends to develop its own Trade Practices Act, notwithstanding the presence of existing and proposed provincial legislation (e.g.’s, Acts in British Columbia and Alberta, a White Paper in Saskatchewan). A request for the establishment of a “technical committee” with the provinces has been made. Existing and proposed provincial legislation has a very high degree of uniformity in terms of identifying market conduct that is to be covered by the legislation, in providing for the signing of Assurances of Voluntary Compliance, etc. The need for uniformity is not, thus, a significant matter. There is concern on the part of British Columbia, Alberta, and Saskatchewan that federal legislation in this area is not necessary, that its presence increases the prospects for yet more conflicts in administration of the legislation and would lead to wasteful uncertainty in both the business and consumer communities. The federal intentions are viewed’ by these provinces as an example of Ottawa’s apparent compulsion to have a federal presence in all areas of commercial and economic regulation regardless of established provincial legislation and activity. In their view, the case for a separate layer of federal legislation has yet to be made.

6. Bankruptcy Act

The latest proposals for a new Bankruptcy Act would create a broader base for federal involvement in debtor assistance programs and their enactment could mean either the erosion of provincial programs or their elimination. However, due to financial considerations. and continuing consultations, the provinces who wish to be involved in such programs appear now to be in a position to negotiate suitable arrangements for the delegation of administrative powers. Those discussions, however, have not yet concluded. It is hoped that it will be possible to reach mutually acceptable agreements concerning the continuation of provincial administration where sought.

7. Proposed Mutual Funds Act and Securities Act

These two areas of federal activity point toward a concerted national attempt, where possible, to centralize investment and registration regimes. Activity in recent months has not been particularly visible although neither project may be classified as being in the dormant category.

IV. Degree and Adequacy of Consultation

1. Bill C-16, Borrowers’ and Depositors’ Protection Act

Although discussions between the federal government and the provincial governments have been going on, in one form or another, for the better part of two years, the results have been very unsatisfactory from the provincial viewpoint. The basic problem stems from the fact that the federal government, instead of being content with dealing with specific problems like loan sharks and tax buyers and updating existing federal legislation (Interest Act and Small Loans Act are the prime examples), decided on its own to develop a brand new, omnibus statute governing nearly all essential aspects of credit granting and advertising, credit cost disclosure, mortgage prepayments, unconscionability, etc. In nearly all of these areas, there are a large number of provincial statutes in operation and several others are in various states of adoption across Canada. Notwithstanding serious objections by a number of the provinces (including a majority of the Western provinces), federal plans for Bill C-16 went ahead and it was introduced in November 1976. It should be noted that the ministers responsible for Consumer Affairs, from Alberta and Saskatchewan have made separate appearances before the House of

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Commons Committee holding hearings on Bill C-16, at which time their several concerns about the constitutionality and impact of Bill C-16 were expressed. Any further federal-provincial discussions are unlikely to take place until the regulations under Bill C-16 are ready for discussion. The regulations in this case are of great importance since a great deal of the administrative framework and a number of important definitions have been left for treatment by regulation. Other discussions apparently are to be sought by the federal government to see if there is a possibility of arranging for some of the administration of the BDPA by the provinces.

2. Bill C-42, Competition Act

Although the 1969 report on competition policy of the Economic Council of Canada called for federal-provincial consultations in putting together the proposals for the Competition Act, introduced in the House of Commons this spring, such consultation by Ottawa was delayed until September 1976 when bilateral discussions were initiated. Theintroduction of the Bill on March 16 has raised afresh the question of new consultations with the provinces, but details were not forthcoming as at mid—April.

3. Bank Act 1977

The federal intentions were made the subject of a White Paper published in 197 6, to which there has been an interprovincial response submitted to the federal finance Minister in December 1976. It would appear that any future discussions will be on a bilateral basis, although the extension of the present Bank Act to 1978 creates new opportunities for federal-provincial discussions.

4. Electronic Payments Systems

Three working Committees toestablish EPS were set up by the federal government in 1975. The committees only provided for provincial membership on the group concerned with “consumer and legal issues.” Objections to this restricted role were voiced by all western provinces and while there is some hope that the slightly restructured response will be more sensitive to provincial interests, it is too early to forecast. Federal-provincial discussions in March 1977 confirmed the need for much better liaison between the federal government and its provincial counterparts. There is substantial provincial concern, not limited to the western provinces, about the present system of consultation on this topic.

5. Trade Practices

Federal aspirations were first telegraphed in 1975 with the commissioning of two studies by legal academics. Although the study appraising the potential for federal legislation calls for very cautious advancement of any federal legislative initiatives, their publication was followed by a request in September 1976 for the provinces to nominate several members to join a technical committee with the federal government with an eye toward achieving greater uniformity with provincial legislation. More importantly, there were references to the inevitability of federal legislation, although indefinite delay was requested by several provinces, including at least three western members.

6. Bankruptcy Act

With particular reference to the debtor side, the first discussions with the western provinces. were held in 1975 and a series of bilateral and plenary discussions have followed. In general, the discussions have been informative and productive with considerable influence being exerted by the provinces.

7. Proposed Mutual Funds Act and Securities Act

Apparently the provinces were neither notified nor consulted on the federal government’s intention to conduct a securities market study. Since that time, subsequent consultation has apparently not been initiated and much the same applies to the proposed Mutual Funds Act.

V. Western Provincial Position

As a general matter, the federal intrusions/initiatives in consumer and corporate affairs have been increasing in recent years and have caused a considerable amount of conflict and friction with provincial legislation and programs.

Federal-provincial relations in these subject areas must be reviewed and should become the topic of fresh discussions between the provincial ministers and the federal minister. There have been some initial contacts in recent months but only a moratorium on the

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further development of federal programs will give the two levels of government the breathing time to take stock of the present situation.

Unfortunately, the federal moves in too many instances appear to be directed toward establishing a national presence for its own sake without any understanding of provincial priorities, jurisdiction, or interests. This is not to minimize the merit in seeking to establish a modern competition policy for Canada, an eflicient public framework for chartered banking, or to deal with the national implications of a cashless society. Regrettably, however the present efforts, almost with exception, would create ever larger federal bureaucracies, would reinforce the development of highly centralist structures, and would produce regulatory schemes unnecessarily insensitive to the interests and responsibilities of the provincial governments.

1. Bill C-16, Borrowers’ and Depositors’ Protection Act

Matters are in a considerable state of flux. A number of amendments are presently being proposed by the federal Minister of Consumer and Corporate Affairs and their potential impact on provincial legislation and programs cannot yet be measured. Also, the federal government wants to pursue the question of delegated and shared administration of the legislation with the provinces.

There is a strong potential for commercial and consumer uncertainty in the face of conflicting and overlapping provincial and federal legislation. The possibility of constitutional litigation is very serious. Within the larger context of federal-provincial relations, there is merit in making common representations that the federal Bill be left in its present state and that the whole question be re-examined in new provincial-federal talks. Delays forecasted for the Bank Act. and the Electronic Payments Systems may be noted as providing another reason for affording time to reconsider the full constitutional and economic costs of the proposed BDPA.

2. Bill C-42, Competition Act

The constitutionality of the proposed legislation should be subjected to fresh study; the costs and benefits associated with a more centralized decision-making process for competition matters should be more closely studied by the western provinces and representations should be made at the earliest opportunity for the recognition of provincial and regional development priorities as a factor in arriving at any decisions; finally, the compatibility of the federal proposals with the economic priorities of the western provinces should be the subject of new, co-ordinated research and commentary, using, inter alia, corporate simulation models.

3. Bank Act 1977

The federal timetable is now six months behind schedule and the present Bank Act will have its life extended through January 1, 1978 (or later). In the circumstances, and given the number of provincial objections noted in the inter-provincial brief of December 1976, the western provinces should follow up the adequacy of the federal response to those objections. The new Bank Act is misnamed; in reality, it promises to be a federal charter regulating the essential activities of the principal financial institutions in Canada, regardless of jurisdictional origin. The extension of federal regulation to provincial entities is a matter of concern and its full implications should be reviewed with an eye toward curtailing the federal outreach.

4. Electronic Payments Systems

As a result of the March 1977 interprovincial discussions, it appears that the existing Committee will be revitalized and new efforts will be made to co-ordinate research on matters of provincial interest. There have been recent provincial complaints about the inadequacy of the present system of consultation and the lack of opportunities for continued provincial input into the planning of the EPS, conditions of access, and all related matters of lawreform. Discussions are continuing and wherever possible, the western provinces should work closely together to ensure that any concrete federal steps are only taken with proper accommodation for legitimate provincial interests in ensuring the competitive viability of provincially chartered financial institutions, regional capital needs, consumer protection principles, and proper access to macro-payments data.

5. Trade Practices

The three most western provinces should ask the federal government to refrain from further legislation in this area in so far as existing and proposed provincial legislation obviously occupies the field.

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6. Bankruptcy Act

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, and that provinces wishing to operate and institute debtor counselling/ assistance programs be delegated the full range of necessary powers (as is the case under the present Act), and that reasonable financial assistance for such operations will be instituted.

7. Proposed Mutual Funds Act and Securities Act

With respect to these matters, the maintenance and improvement of interprovincial co-operation and liaison should be continued. The case for a separate or additional federal level of regulation, under either heading, remains to be made. Federal-provincial discussions in recent times have been on a very intermittent basis.

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Resources

Summary

Some of the most contentious issues in federal-provincial relations in recent years have centred around the natural resource sector. Various federal initiatives, especially since the energy crisis in the fall of 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 management of renewable and nonrenewable resources. For example, the federal govemment’s proposal for a national forestry policy could have serious land use implications for the provinces and might not account for their economic diversities. Federal-provincial confrontations over the use of nonrenewable resources have resulted in a loss of confidence by some investors in the resource industries in Canada as an area of further development. These conflicts have involved the pricing and taxation of nonrenewable resources, and to a lesser extent, the control of supply and production.

The conflict of jurisdiction between the federal government and the provinces centred around the pricing and taxation on nonrenewable’ resources and to a more moderate degree the control of supply and production. Intraprovincial trade and natural resources ownership and management thereof are the responsibility of the provinces under the constitution. The federal government is responsible for interprovincial and international trade. While provincial jurisdiction over a natural resource may be extended to control the price of the product within the province, the federal government has claimed that the marketing of the product across provincial or international boundaries comes under its jurisdiction, The situation is further complicated by the divergent interests of the producing an consuming provinces.

PART I. RENEWABLE RESOURCES

I. Intrusions

Concern was expressed over federal initiatives relatin to a national forestry policy.

II. Impact on Provincial Policies and Programs

The national forestry policy’s objective, as advocated by the federal government late in 1975, was to formulate future courses of action regarding the forestry industry. A joint federal-provincial committee composed of the provincial environment ministers and two federal representatives was proposed to develop this policy. The federal government’s concerns seem to be extending beyond research and interprovincial movement into the areas of development and replacement policies. As such this federal initiative has serious land use implications for the provinces. The impact of such a policy would also be felt in other provincial sectors such as agriculture, manpower, industry, etc., and could force changes in environmental standards and guidelines.

III. Relation to Federal Policy

The national forestry policy is still a proposal; the specifics of the program and the membership of its committee are vague and were only suggested in federal correspondence to the province, dated March of 1976. Realization of the proposal could strengthen federal involvement in policies affecting general land usage, and forestry industry matters in particular.

IV. Degree and Adequacy of Consultation

Some bilateral consultation has occurred in relation to the development of a national forestry policy. To date, these policy discussions have centred on defining the federal government’s role in assisting with forest fires. As far as the discussions have progressed the consultation has been adequate but any new developments that might specify new proposals would have to involve extensive provincial participation in order that provincial jurisdiction over forests be preserved and the possible implications of this program be fully explored.

V. Western Provinces’ Position

With regard to a national forestry policy the provinces acknowledge a need for national uniformity of forestry statistics and standards and recognize the importance of assessing the resource’s financial benefits. But, because of the vagueness of the proposals and in view of possible jurisdictional problems it is felt that the objectives of the program should be more closely outlined, perhaps via CCREM (Canadian Council of Resource and Environment Ministers), such that legitimate areas for federal involvement are closely defined.

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PART II. NON-RENEWABLE RESOURCES

I. Intrusions

The federal initiatives that in some instances adversely affect the provinces’ nonrewable resource sectors are:

a. Resource Taxation
Nondeductibility of Royalties
b. Pricing
i. Petroleum Administration Act
ii. Ten Cent Excise Tax on Gasoline
c. Supply and Disposition
i. National Energy Board Act
ii. Emergency Supply Allocation Act
iii. Federal Government Legal Intervention
re: Saskatchewan Potash
iv. “Canada First” Policy
d. Resource Appraisal Programs
e. Research and Development Program
f. Mineral Policy Objectives
g. National Coal Policy

II. Impact on Provincial Policies and Programs

a. Resource Taxation

Nondeductibility of Royalties—In May 1974 the federal Minister introduced a budget which conained modifications to the tax position of the resource sector. The most critical change in effect disallowed royalties paid by the companies to the provinces as a deducion in the calculation of federal Corporate Income Tax. With the calling of the federal election, the proposal was dropped. However, the November 18 budget of 1974 provides only a 25 per cent allowance of gross revenues as a royalty expense deduction. Concern about this federal budget proposal focused on the effect the tax measure would have on a province’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.

As such this provision represents a serious challenge to the fundamental rights of the provinces to control and benefit from the development of the resources they own.

b. Pricing

Since 1973 the federal government has made several moves to control the price at which petroleum and natural gas is sold. The negotiated prices for petroleum and natural gas which were reached in 1974, 1975, and 1976 all have had the effect of keeping the price of western Canadian resource production below world market levels. As well as interfering with a province’s right to receive “fair market value” for its resources, conflicts over pricing and taxation have had a serious impact on the western Canadian economy accentuated by a slowdown in exploration and development. The one price system for Canada and the corresponding subsidy to the easterm provinces has been supported in principle by the west but, in the estimation of the producing provinces, the last three price increases have not been sufficient to ensure adeqaute returns to the industry, or to pursue energy self-reliance for Canada as a whole. The situation has also restricted the long-term planning ability of both the province and the industry concerned.

i. Petroleum Administration Act—Some of the provinces have expressed reservations regarding the Petroleum Administration Act, Bill C-32, since its implementation in April 1975. In particular, part of the federal act confers upon the federal government the following:

1) the authority to terminate a pricing agreement unilaterally;
2) to decline to negotiate a renewable agreement, and;
3) to impose by unilateral action maximum prices on the natural resource owned by a Province.

Part 3 in effect amounts to an assertion that the federal government has the power to regulate the prices, the flow, the production, and the sale of a provincial natural resource.

ii. Ten Cent Excise Tax on Gasoline—The federal government’s ten cent excise tax on gasoline that has been 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.

c. Supply and Disposition

i. National Energy Board Act—The control of supply and distribution of natural resources is identified as a direct intrusion by the federal government that challenges the basic principle

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of ownership and management by the provinces. The federal government through the National Energy Board Act exercises control of exports (volumes and price) of crude oil, natural gas, and related hydrocarbon by-products. In this instance, federal cabinet decisions, without provincial input, have been made to effect changes in NEB regulations. The impact on provincial and industry revenue, both in the shortand long term through the decrease in the degree of resource development, production efficiency and productivity, has been most evident.

ii. Emergency Supply Allocation Act—The Emergency Supply Allocation Act empowers the federal government to declare a national emergency in the event of an active or anticipated shortage of petroleum or a disturbance in the petroleum market considered to be severe enough so as to affect national security, welfare, and economic stability of Canada, and thereby to authorize the Board to make and enforce regulations and priorities for the distribution of petroleum products at the wholesale level for the duration of such an emergency. Western Canada’s surplus productive capacity would be of paramount importance in meeting a shortage of supply of crude oil in an emergency. The issue is one of lack of provincial representation and input on the Technical Advisory Committee to beset up under this Act. As the owner of the resource the provinces should be involved in supplying information and in a co-ordinating role; In addition, the whole question of who makes the ultimate decision regarding allocation to users within a province has not been addressed to the satisfaction of some of the provinces.

iii. Federal Government Legal Intervention re: Saskatchewan Potash—The federal government has also directly intervened by legal action against the Province of Saskatchewan in connection with oil and gas royalties and the potash prorationing system and potash taxes. This represents another aspect of intrusion into provincial jurisdiction, and places severe pressure on the Supreme Court of Canada. It further demonstrates 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 ultimate concept of export control on specific resources (such as coal and uranium) should also be noted as an area of concern for some of the provinces.

d. Resource Appraisal Programs

Examples of federal initiatives in area are the Plains Coal Resource Evaluation Program and the Uranium Reconnaissance Program. The provinces’ concerns over resource appraisal programs vary but it is commonly felt that the federal government involvement clouds the general question of resource ownership and jurisdiction. The two programs noted were unilateral federal initiatives to appraise and assess coal and uranium resources within specific provinces. The concerns as identified are two-fold. First, the federal criteria for appraising coal reserves can differ from provincial criteria that are used in issuing industrial development permits. Second, past experience indicates that the federal government tends to use the resource information to further their own objectives, which may conflict with provincial objectives.

e. Research and Development Programs

The federal government has undertaken continuing initiatives in sponsoring research involving provincially owned resources. This also has the effect of clouding the ownership and management issues related to development of provincial resources. Federal research programs covered one aspect of a problem without taking into account the important general development concerns of the provinces. Consequently, information gained through such initiatives could be used in furthering the objectives of the federal government, and thereby increasing the conflict with the provinces.

f. Mineral Policy Objectives

The objective of the federal initiative in this area is to set standards in regard to resource and export pricing, environmental concerns, and manpower objectives. Phases I and II of a Mineral Policy for Canada were implemented in 1972/73 and 1973/74 respectively. Phase III, which is now under way, would give the federal government a greater say in resource development. Concern was expressed that this policy could limit the provincial scope of management of mineral resources.

g. National Coal Policy

An attempt is presently being made by the federal government to develop a coal policy for Canada.

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Since the resource is owned by the provinces and is limited to certain geographical areas, a national policy should be developed that allows for the participation of the province owning the resource and keeps legitimate provincial objectives in mind. In the past, federal policy on either minerals or coal have directly influenced decisions with the various provinces over their management of resources. The concept of resource ownership and resource management by the provinces must be noted and expanded in any mineral policy discussions.

III. Relation to Federal Policy

The various federal programs relating to nonrenewable resources which have been implemented or initiated during the past five years indicate a continual thrust by the federal government into provincial jurisdictions in an attempt to develop national priorities for energy which supersede provincial priorities. This attempt is based on the federal govemment’s recognition of the need to counteract the impact that future energy problems such as the anticipated costs of additional energy supplies, the loss of self-suificiency in oil, and an increased dependence on foreign oil supplies can have for a health functioning of our domestic economy.

While the provinces do not contest the federal govemment’s responsibilities in the case of an energy emergency, nevertheless they generally do not feel that their own concerns have been given enough consideration in the development of these national programs.

IV. Degree and Adequacy of Consultation

The degree and adequacy of the consultation process which has emerged since 1973 between the federal and provincial governments on nonrenewable resources is very difficult to assess. There have been some areas where a complete lack of consultation is evident, notably the measures of resource taxation, volume and export control, and the export tax on petroleum and natural gas products. Although a number of decisions have been reached, the relationship between the federal and provincial governments on these matters has been very tenuous and sometimes very volatile. Examples indicating the complex and undefined nature of these energy issues would be the unusual step by the federal government in joining Central Canada Potash Company as a co-plaintiff against Saskatchewan’s potash prorationing system and the many federal-provincial, bilateral, and multi-lateral meetings that have occurred at all levels on the subject of energy and minerals.

V. Western Provincial Position

In the whole field of nonrenewable resources, the provinces must continue to reaffirm their constitutional responsibilities and carefully assess all federal initiatives in light of their own objectives and to demand greater federal-provincial consultation in these areas.

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Housing, Urban Affairs,
and Land Use

Summary

Under the terms of the British North America Act. provincial governments have jurisdiction in the fields of public lands, municipal institutions, local works and undertakings, property and civil rights, and, generally, matters “. . .of a merely local or private nature.” All provinces, as well as the federal government at various times, have acknowledged that these specific constitutional provisions give the provinces jurisdiction over housing, urban affairs, and land use.

Since 1945, when the first National Housing Act was proclaimed, the federal government has played a major role in this policy area. Under the auspices of the N.H.A., the federal government has been making decisions and initiating programs which directly affect housing, urban affairs, and land use. And, until recently, this federal involvement has been generally accepted by the provinces.

In recent years, however, federal intervention has become more systematic and aggressive, and has begun to challenge provincial jurisdiction in these fields in a more direct way. In large part, these federal initiatives have been aimed at the municipal or local level.

In some instances, the initiatives have thwarted provincial objectives and policies. In others, they have adversely affected local government planning and priorities.

The development, by the federal government, of strategies and policies with respect to urban land use and development, urban growth and control, and local planning are a few examples which obviously interface with the municipal sector. Specific federal activities, notably legislation in regard to housing and rail relocation, demonstrate the direct role played by the federal government in these policy fields.

In addition, there are a host of shared-cost programs involving all three levels of government. Some, such as social assistance and certain housing programs, require municipalities to deliver the services. Others, including, for example, the Neighbourhood Improvement Program and the Municipal Incentive Grant, provide for optional municipal participation, at the initiative of the municipalities concerned.

As well, the federal government has a powerful influence on municipal land use planning, through its control of federal Crown properties, such as railway rights-of-way, airports, federal government buildings, and national parks. Increased CMHC involvement in urban development projects, together with greater restrictions on CMHC funding, such as those proposed with respect to flood-prone areas, reinforce this federal influence.

Although the impacts of these federal initiatives on provincial and local government policies and programs are varied, there is at least one common thread which ties them together—they 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 threaten to produce conflicting legislation and regulations between the federal and provincial governments.

A number of measures should be taken to minimize conflicts in this policy sector.

As a first step, government jurisdictions and responsibilities should be clearly spelled out. The provinces do not question the jurisdiction of the federal government over general monetary policy, which has a substantial impact on housing. The federal government, with its authority over monetary policy and banking, has a legitimate role to play in the supply of loan capital to the provinces for the purposes of housing, land development, and municipal works. The federal government has the major role, as it were, on the “demand side” of the equation.

At the same time, it should be made quite clear that the provinces have the major role on the “supply side.”

The formulation of policy in the fieldsof housing and urban all airs, as well as the development and delivery of programs in these fields, is within provincial jurisdiction. As such, the federal government should relate to local government, in policy discussions as well as funding, through the provincial governments.

I. Federal Intrusions

1. Programs the federal government offers directly to municipalities.

2. Certain housing programs (AHOP, Assisted Rental Program).

3. Urban planning and urban land development.

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4. National guidelines for land use (national land use policy).

5. Aeronautics Act amendments.

6. Flood hazard reduction program.

II. Impact on Provincial Policies and Programs

1. Programs the federal government ofiers directly to municipalities

Direct federal grants to municipalities in the field of housing, such as Municipal Incentive Grant for medium density housing, have several effects on provincial governments. First, they may subvert provincial policies and programs, and enable the federal government to determine priorities in the housing field. Provincial priorities in this field are already greatly influenced by the CMHC annual budget. Second, in many instances provincial governments are bypassed in this process, challenging provincial jurisdiction and adversely affecting intergovernmental relations, both federal-provincial and provincial-municipal. Third, such federal initiatives could have a negative impact on provincial land use policy and local zoning regulations. Direct federal involvement with the municipalities without provincial input or approval in areas affecting housing, urban affairs, and land use could undermine provincial responsibility in these fields.

2. Certain Housing Programs (AHOP, Assisted Rental Programs)

The Assisted Home Ownership Program (AHOP) and the Assisted Rental Program have a direct impact on provincial housing policy. These programs couldafiect the balance of owner-occupied to rented housing in the provinces, distort provincial housing markets, and counter municipal plans and priorities. The programs also have a great impact on urban land development. Any or all of these effects could offset provincial and municipal objectives, plans, and priorities. Potential problems are caused by the administrative rules and regulations established not by legislation nor by Order in Council, but by head office staff and interpreted in a variety of ways throughout the country. An example is the establishment of AHOP price ceilings and the boundaries. In some areas, these rules and regulations have a tendency to drive development to the outer fringes rather than to encourage it in the built up areas.

3. Urban Planning and Urban Land Development

Through direct and conditional funding, the federal government is becoming involved in urban land development. CMHC is beginning to assume the role of a land developer, while MSUA, through such programs as rail relocation, has the potential to greatly influence urban land use and development. The federal government is also funding urban planning studies.

These federal initiatives could influence the pattern of urban development, the approval process for land development, the municipal planning process, the timing and location of both industry and urban development, and, hence, regional development within the province. For example, standards for subdivision development determining eligibility for NHA insurance is akey determinant of the subdivision quality and form, but may not necessarily be compatible with local requirements or provincial policies. Each of these federal intrusions undermines provincial responsibility in these fields.

4. National Guidelines for Land Use (National
Land Use Policy)

According to the former Minister of the Environment, the Honourable Jean Marchand,

“. . . such guidelines would enable the federal government to both direct and internally co-ordinate its activities which have land use effects so as to fulfill the needs of the provinces and the needs of the nation as a whole.”

In the past, the federal government has recognized that it has little direct jurisdiction over land use. This newly “proposed federal involvement rests on the premise that many federal programs and policies have a great impact on land use, and thus guidelines are needed to ensure the harmonization of land use practices. The provinces maintain that land use policy is a direct provincial responsibility, and several, including Alberta and Saskatchewan, have taken steps to develop more comprehensive provincial land use policies.

It appears that the federal government has deferred, for the time being, this major intrusion in the area of land use policy. It should be noted, however, that the issue will quite likely be revived. Land use in the most general sense is a direct provincial responsibility.

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5. Aeronautics Act Amendments

The proposed amendments to the Aeronautics Act would enable the federal government to control development in the vicinity of airports. Such enabling legislation could restrict provincial initiativesin this area. Since several provinces already have legislation and regulations governing the use of such land, there is the possibility of conflicting federal and provincial standards and requirements.

6. Flood Hazard Reduction Program

The federal government has proposed a federal-provincial program on flood-hazard reduction which would restrict development in flood-prone areas. This would be accomplished, in part, by ensuring that federal fimds, including CHMC loans, would not be available for projects in these areas. In addition, no federal compensation would be paid for flood damages in such areas. The federal concern has been prompted by the increased payments made to the provinces to help compensate for flood damage. The federal government is advocating a general or “umbrella” federal-provincial agreement, with specific subsidiary agreements concerning mapping and study techniques. This could intrude into the provinces control of land use and development. Moreover, some provinces already have programs which meet these concerns. There is some apprehension that, in such instances, the federal-provincial program may not complement existing provinical programs.

III. Relation to Federal Policies and Programs

As the Hellyer Task Force pointed out in 1969, the federal government was reluctant to create a department concerned essentially with matters of housing and urban affairs, since these matters were outside its constitutional jurisdiction. Nevertheless, the federal government decided, in 1971, to. create a Ministry of State for Urban Affairs. By creating a ministry of state rather than a department, the federal government hoped to deflect at least some of the criticism suggesting that it was invading an area of provincial jurisdiction.

Until recently, the major emphasis of the Ministry of State for Urban Affairs (MSUA) has been on research and policy development, aimed at defining an urban growth and development strategy. There is increasing evidence, however, that the recently reorganized. MSUA and CMHC are adopting, on behalf of the federal government, a stronger centralist role. They are beginning to resemble what was recommended by Michael Dennis and Susan fish in the “Task Force Report on Low Income Housing.”

“In order to develop a national housing policy—or, more specifically, a national social housing policy—responsive to and reflective of government aims and priorities, this report recommends that housing become a department rather than a crown corporation function, and that a Department of Housing be established.”

The federal initiatives noted on the previous pages collectively present a picture of a heightened federal presence in the fields of housing, urban affairs, and land use.

IV. Degree and Adequacy of Consultation

As a rule, consultation by the federal government has never preceded major changes inlegislation or regulations. Consultations at the officials level are usually in the vague context of “policy research.” In the broad areas of housing and urban affairs, consultation has been virtually nonexistent.

Many doubts exist concerning the national tri-level process. The suspicion that the federal government is using the tri-level structure as a method of consolidating an expanded federal role in local government affairs seems well-founded.

The national tri-level experiences suggest that tri-level meetings will not serve to rationalize roles and jurisdictions with regard to senior governments and the delivery of programs. There is some evidence to suggest that the national tri-level approach is counter-productive. Competition and rivalries between the two senior levels of government are not eliminated, but exacerbated. Moreover, from a municipal or provincial point of view, it would be detrimental to encourage direct federal involvement in urban program delivery, at the expense of a healthy provincial-municipal relationship.

With respect to land use, the federal government has provided adequate opportunities for the provinces to participate in discussions concerning national land use guidelines. However, since the provinces consider land use to be strictly a matter of provincial jurisdiction, they have not viewed these proposed consultations as necessary.

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V. Western Provincial Position

A number of steps should be taken to minimize conflicts resulting from federal initiatives in the fields of housing, urban affairs, and land use.

1. The jurisdictions and responsibilities of the federal and provincial governments in these fields should be more clearly delineated. Federal-provincial discussions toward this end should. begin at an early date. The primary role of the federal government should be to provide loan capital to finance housing and urban development. This is in keeping with federal authority over monetary policy and banking. However, CMHC should lend only to provinces and municipalities. In addition, any grants from the federal government to municipalities should go through the provincial government.

The primary role of the provincial governments should be to formulate housing, urban development, and land use policies for the provinces; to deliver all housing programs; and to sponsor experimentation and the development of new concepts and processes in housing.

2. Relations with respect to housing, urban affairs, and land use should be bi-level, and not tri-level. Bilateral relations should proceed between the provincial and federal governments, and between the provincial and local governments. The federal government should relate to local government through the provincial governments.

3. Given the provincial constitutional responsibilities in these areas, a more appropriate form of consultation should be developed. Federal-provincial conferences of ministers should be held at regular intervals, and certainly in advance of any legislative changes related to housing or urban affairs. Aside from institutionalizing federal-provincial consultation at the ministerial level, more regular meetings of senior federal and provincial oflicials should also be established.

4. In terms of financing local government, long-term reform of the public finance system is needed, not short-term federal dollars. The pattern of unilateral, ad hoc intervention by the federal government tends to distract local priority setting. The problem of financing local government should be discussed at the provincial-municipal level.

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Economic Development

Summary

Recent developments within the 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 with 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 aspirations of central Canada. Both the federal and provincial governments have legitimate responsibilities within the field of economic development. On various fronts, federal actions seriously affect the direction of provincial development. In general, federal intrusions in the economic development field take the form of federal actions which limit the scope for independent provincial action, and which create impediments both to the implementation of provincial programs and policies and to the realization of provincial objectives.

I. Intrusions

Federal initiatives affecting provincial economic development were highlighted in the following general areas although not all provinces had equal concerns with each area:

1. Agriculture
2. Transportation
3. Trade (GATT)
4. Industrial Development
5. Environmental Concerns
6. DREE

II. Impact on Provincial Policies and Programs

1. AGRICULTURE

The strength of the agriculture sector is of prime concern to the western provinces. In general, it was felt that the federal programs had been lacking in responsiveness to the needs of the industry. A review of federal initiatives in the last several years indicated some progress has been made.

a. Income stabilization received much attention. Three Bills have been passed and partially implemented—the Agricultural Stabilization Act, Bill C-50; the Western Grains Stabilization Act, Bill C-41; the Two—Price Systems for Wheat Act, Bill C-19. Although it is still too early to evaluate the success of these Acts concerns were raised about the administration of these bills and their responsiveness to changing market situations. As well, it was felt that the exclusion of other products under Bill C-50 would result in the proliferation of provincial stabilization programs. The provision for provincial top-loading to Bill C-50 has not succeeded in achieving provincial co-operation and harmonization of programs on a national basis. A good example of this is the situation that surrounded the cow-calf program for the last three years. It was not until January 1977 that the federal government accepted its responsibility for this area and made the cow-calf program part of Bill C-50. The federal government’s delay in responding to this legitimate provincial need meant that many of the provinces developed their own programs and that some problems now exist in hannonizing the previous provincial programs with the national one.

b. Credit was also highlighted as being extremely important for obtaining the objective of a balanced growth in agriculture. A 1975 federal budget cut-back has severely restricted Farm Credit Corporation loans to both beginning and established farmers. Cutbacks in available credit will tend to discourage the small family farm and will also increase pressure on local and provincial lending institutions.

c. Federal levy on fluid milk—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 pricing jurisdiction.

2. TRANSPORTATION

One of the major obstacles to a faster and more balanced rate of economic development in the west is the deficiencies in the transportation infrastructure serving the region. The provinces did not question the federal government’s jurisdiction in the interprovincial transportation field but rather, the manner in which this authority was exercised. The federal government has tended to view transportation policy in its narrowest sense. For example, the western provinces are opposed to the federal policy of setting freight rates according to “what traflic will bear.” Transportation is fundamental to the achievement of diversification

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of the economic base in the western provinces. Freight rate patterns have tended to inhibit the achievement of this objective.

Concern was expressed over broad federal policy direction in the transportation area and the progress being made on the transportation problems identified at WEOC as being of special concern to the western provinces. Rail relocation, rail line abandonment, the freight rate issue and proposed changes in the National Transportation Act were all highlighted. Concern was expressed over undue federal emphasis on the user-pay philosophy. A major unresolved issue from 1976 is the federal government’s underlying intention to implement federal control over inter- and extra-provincial motor carrier operations now delegated to the provinces.

Another area which was identified was the proposed federal public transport policy. Although still in the developmental stage, the federal government’s plan would be to work directly with the municipality in assuring the development of public transportation systems. Concern was expressed about the interference in a provincial area of responsibility and the possible proliferation of federal regulations.

3. TRADE (General Agreement on Trade and Tariffs)

Although the federal government’s responsibility for negotiating such agreements is clear, and is therefore not an intrusion per se, provincial input into the final position of international trade negotiations is of utmost importance, given the importance of foreign market penetration to the realization of western economic development objectives. Dissatisfaction was expressed with the degree of consultation which has taken place between the federal and provincial governments on the development of Canada’s position at the GATT negotiations. In addition, concerns were raised that only central Canada would benefit from the federal position. Generally, it was considered that the liberalization of trade with the reduction of tariff and nontariff barriers is vital to develop a secure. economic base in the west; to aid industries reliant on natural resources (agriculture, forestry, mining, etc.); to encourage industrial growth through secondary industry; and to develop a strong manufacturing sector.

4. INDUSTRIAL DEVELOPMENT

The federal government has undertaken the development of “strategies” for 19 industrial sectors (i.e., fertilizers, petrochemicals, foundries, steel, rapid transit). Although many are still in the development stage, the province felt many of the policies were biased toward central Canada and in large part ignored regional aspirations. In many cases, they disregarded the concept of upgrading A near the source of raw material supplies.

Another area of concern was the lack of federal initiatives in assisting small businesses. There has been increased pressure on provincial governments to fill the vacuum. The recent Federal Throne Speech did announce certain proposals to aid small businesses, but care must be taken that the policies developed are complimentary to the aspirations of the provinces.

5. ENVIRONMENTAL CONCERNS

Various federal initiatives were identified in the area of environmental controls. In general it was felt that, while the concept of national water pollution A guidelines had some validity, the resulting approach may be too stringent for baseline control and may restrict the provinces’ ability to cope with local problems. Recent federal initiatives in the area of pollution control regulations have caused some duplication and have implications for resource ownership.

Another general area of concern was federal environmental studies, presently undertaken on a wide range of issues, which may result in recommendations and policies affecting provincial land use, water use, and development programs, with little regard for specific provincial needs. Another initiative which raised concern was the flood-hazard reduction program. This program would restrict development in potential problem areas and could lead to more federal control in provincial land development.

6. DREE

The federal Department of Regional Economic Expansion provides programs of “economic expansion and social adjustment in areas requiring special measures to improve opportunities for productive employment and access to those opportunities.” Because of the large amounts of money being injected into provincial economies the potential exists that DREE activities may conflict with provincial priorities.

The rationale behind DREE’s decentralization and the GDA was to improve DREE’s responsiveness, to provincial priorities. In general, this has occurred, but the increased local staff and expenditures continue

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to hold the danger of skewing provincial priorities toward federal objectives. Concern was also expressed regarding the increasingly elaborate and sophisticated requirements being imposed by DREE for joint planning, which entails inevitable difficulties and delays. There was particular concern expressed regarding the length of time requiredto receive official DREE approval for new initiatives. The federal directive ruling out retroactive cost—sharing further compounds the problem. If the province proceeds on an initiative before the lengthy process of approval is completed, it stands to lose shared-cost dollars.

III. Relation to Federal Policies and Programs

Recent federal initiatives in the economic development field must be viewed within the context of the over-all federal policy to take a strong and active role in directing and controlling the national economic system. This is evident through initiatives in the sphere of economic planning, through economic incentives and through controls and regulations. Although the provinces may have to accept increased federal involvement in specific areas, what is required is federal recognition that the provinces also have a crucial role to play in economic development, that there is the necessity for increased federal-provincial joint economic decision-making and that in some areas the provincial government must play the lead role.

IV. Degree and Adequacy of Consultation

Because of the joint responsibility in the area of economic development, adequate federal-provincial consultation is essential to the realization of both provincial and federal objectives.

For agricultural issues the consultation between the federal and provincial governments has generally been good. Although agreement has not always been attainable, in certain cases the provinces have had considerable impact on the development of federal policies.

In the transportation area consultation has been fairly intensive since WOEC. The establishment of FP/COWT has been a major step in providing a forum for discussing transportation problems and their effect on regional development. The quantity and quality of dialogue has been substantially enhanced, although in many cases the mechanism has not met expectations. in improving consultation, and few concrete decisions have resulted.

On the issue of trade negotiations, the provinces have in general been disappointed with the degree of consultation that has occurred. There has been some liaison and provincial input but no feedback on how the Canadian policy is evolving.

Concern was expressed at the lack of consultation between the federal and provincial governments on the development strategies for major industries being prepared by the federal government. The lack of consultation on such important matters limits the effectiveness of possible provincial responses.

V. Western Provincial Position

There is a general need for the provinces to continue to put strong pressure on the federal government for better federal-provincial liaison in the development of viable agricultural and industrial development strategies for western Canada. More provincial input into national economic decision-making is needed.

1. Both federal and provincial governments must make a full commitment to joint planning and initiatives in order to obtain the objective of balanced growth in agriculture.

2. There is a need for increased pressure on the federal government to develop a more equitable transportation system to meet the economic objectives of western provinces.

3. The provinces should demand a more active and substantial role in the formulation of national policies in such areas at GATT negotiations.

4. The federal government should realize the necessity of jointly formulating a national industrial strategy for Canada, to provide a framework for the realization of individual economic objectives.

5. With regard to environmental matters, priority should be given to provincial objectives. In many instances federal minimum standards with provincial responsibility for application and enforcement would solve the conflict.

6. With respect to DREE, there must be recognition that the provincial governments retain primary responsibilityfor establishing the priorities for provincial economic development. All DREE subagreements should reflect provincial priorities. To ensure compatibility 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. Close liaison between provincial and DREE officials at every step is necessary to ensure compatibility.

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Communications

Summary

Although the western provinces, for a number of reasons, have not adopted common policies in all areas of the communications field, they share many concerns. One province, Manitoba, feels that its interests have largely been met in its recent agreement with the federal government on programming and carrier ownership of cable television hardware.

The western provincial governments all agree that some aspects of communications policy should be subject to provincial control and jurisdiction. Cable television services which do not directly involve the relay, restransmission, or amplification of broadcast signals should be subject to provincial control. So should educational communications which are carried out by means of cable or wire technology. There is also considerable agreement that the commercial content of advertisements used by broadcast undertakings should be subject to provincial advertising laws of general application.

Several provinces are of the opinion that cable distribution systems should be subject to provincial laws, and that the provinces should control and regulate cable distribution systems. Federal regulation should apply only to their use within the Canadian broadcasting system.

Several provinces also share the view that provincial governments should continue to oppose any federal moves encouraging the interconnection of federally-regulated carriers, which serve to diminish provincial control over their telecommunications carriers, and which result in a deterioration of levels of service to remote and rural areas.

I. Federal Intrusions

1. The federal government, through the extension of its authority under the Broadcasting Act, plans to adopt a policy toward pay television which will involve federal regulation of closed-circuit entertainment services provided by coaxial cable:

2. The federal government is attempting to impose on the province“ a definition of “programming” which would restrict provincial government use of communications technologies to deliver social, educational, and cultural services to the public. Manitoba has resolved this issue with the federal government.

3. A federal agency, the Canadian Radio-Television and Telecommunications Commission (CRTTC), has taken steps to regulate commercial television advertising, so as to affect the validity and scope of provincial laws relating to advertising.

4. The federal government has adopted interconnection policies which favour a liberalization of rules, permitting the connection of customer-owned terminal attachments and interconnection between the networks of federally regulated carriers.

II. Impact on Provincial Policies and Programs

The four federal intrusions cited above have the potential to erode provincial authority in the policy fields of telecommunications, education, and culture, and commercial advertising regulation.

1. Telecommunications

Several moves by the federal government have the potential to reduce existing levels of provincial authority over intraprovincial communication services:

On June 2, 1976, the federal Minister of Communications announced the federal government’s willingness to consider a policy introducing pay television into Canada. The adoption of a national pay television policy could involve federal government licensing of closed-circuit cable services and undertakings, and possibly the commissioning of a single network responsible for the acquisition, production, and distribution of pay television programming for the entire country.

A federal agency, the Canadian Radio-Television and Telecommunications commission, announced on April 15, 1976, regulations governing the use of Master Antenna Television systems (MATV). MATV systems are commonly used in certain apartment complexes to improve the reception of television signals available off-air, but are also capable of providing additional closed-circuit services such as pay television, security and alarm services, and so on. By expanding its regulatory control in this way, the CRTTC could assume regulation of nonbroadcast as well as broadcast services carried on MATV systems.

In recent cable licensing decisions in Saskatchewan and Manitoba (July 15, August 18, and September 16, 1976) the CRTTC

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continued a policy of prohibiting broadcasting receiving (cable television) undertakings from leasing cable television delivery services from common carriers. CRTTC licensees were required to own the electronics of the cable delivery system and the drops (lines) to subscribers’ homes and apartment buildings. Provincially regulated telephone companies constructing their own cable delivery systems were thereby prohibited from using this equipment to deliver the signals of cable television operators.

Through negotiation, federal officials continue to seek provincial governments’ acceptance of federal authority in relation to “programming” and other broadcast-related services. Current federal definitions of “programming” tend to extend their jurisdiction over “radiocommunication” and “broadcasting” into a wide variety of entertainment and educational services provided to the general public. According to the present definition, any such services provided to the public by means of a telecommunications system, and which can be judged to have an impact on the national broadcasting system, constitute “programming” and hence are within the federal domain.

All ofthese actions tend to expand federal control over cable communications systems which are entirely local and intraprovincial in nature. As a corollary, provincial roles in the regulation of telecommunications systems and services could diminish. Since Ottawa requires that all cable” television systems, including master antenna systems, come under its direct control, provincial governments are unable to plan for the orderly development of telecommunications services and systems within their boundaries. Moreover, the capacity of a provincial government to regulate or foster the introduction of new forms of telecommunications services is restricted.

Furthermore, in specifying as “programming” a wide variety of services provided to homes by means of wired communications networks, the federal government also claims jurisdiction over communications services presently within provincial jurisdiction. At the moment, communications services and undertakings located entirely within the boundaries of a single province rest within the provincial domain by virtue of section 92 (10) of the British North America Act. For this reason, cable distribution systems wholly situate within a single province should be properly regarded as objects of provincial, not federal, regulation. Nonetheless, since cable systems have been primarily utilized to retransmit off-air television signals, federal regulation of these systems has been established in a de facto sense. To this point, however, federal authority has been sustained mainly on the basis that cable systems used for this purpose were mere extensions of the broadcasting system as a whole. To the extent that they begin to be utilized to deliver nonbroadcasting services on a closed-circuit basis (i.e., without the use of “radiocommunication”), the argument for federal control over cable distribution systems is weakened.

The federal concept of programming encompasses any telecommunications service delivered to the public which is designed to entertain, enlighten or inform, and which may be judged to have an “impact” on the Canadian broadcasting system. Educational cable television channels provided on a purely closed-circuit basis by provincial educational authorities might therefore qualify as programming, as would locally originated community and access channels.

The exertion of control over cable distribution systems through the CRTTC, and the insistence on a broad, expansive definition of programming are the two most manifest federal actions limiting the exercise of provincial jurisdiction over telecommunications. If federal legislation designed to centralize communications policy responsibilities under the Minister of Communications is enacted, as planned, Ottawa’s position may well be strengthened. Under these circumstances, a rationalization of policies in the above fields, with those pursued in the areas of electronic payments, systems interconnection, and satellite communications, could well take place.

2. Education and Culture

The preservation of provincial government authority in the fields of education and culture depends on two factors relevant to communications. first, the exercise of jurisdiction in these areas will increasingly depend on a government’s capacity to harness existing and future communications technologies. As these technologies develop, educational and cultural activities will evolve specifically relying on the use of sophisticated communications systems and equipment. Of course, governments responsible for fostering and regulating such activities should not be unduly restricted in their use of communications technologies for this purpose. However, as indicated previously, existing federal policies in communications could lead to the restriction of provincial authority in this area.

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Communication policies may affect provincial roles in education and culture in a second way. A government’s pursuit of cultural objectives is often a function of its capacityto direct the surplus revenue of a given industry or enterprise into certain channels. For example, the federal’ government has attempted to regulate the private broadcasting industry in such a way that revenues will be devoted to the production of Canadian television programming. A similar technique could well be applied to a Canadian pay television industry. If plans for federal control over pay television were realized, the central government would obviously regulate the collection and allocation of revenue. If, however, the provinces retained a meaningful role, some of this money would then be available to stimulate cultural development and cultural industries within the provinces.

In summary, to preserve their powers over education and culture, provincial governments must be free to utilize communications technologies in the delivery of educational and local/regional cultural services, and must also be able to regulate revenue flows within communications systems under their jurisdiction.

3. Commercial Advertising Regulation

Most provinces have enacted legislation governing the use of commercial advertising. Designed to protect the consumer, provincial statutes or regulations’ regarding advertising may apply generally to all communications media, including television and radio. In Saskatchewan’s liquor laws, for instance, a general prohibition is applied on the commercial advertisement of alcoholic beverages. Similarly, under Quebec’s Consumer Protection Act, companies are forbidden to direct to children any commercial advertisements which employ cartoons. According to existing constitutional law, statutes of this type—laws of general application within the province—remain intra vires the province. With respect to federally licensed broadcast undertakings, commercial advertising is subject to general federal regulations (e.g., number of minutes in an hour), while still being subject to certain provincial laws.

This system of shared authority over commercial broadcast advertising is being challenged by recent federal actions. On June 2, 1976, the CRTTC published regulations suggesting a more comprehensive form of regulation of commercial advertising. The new regulations introduce a system of compulsory registration of all television commercials. The registration program is considered by the Commission to be the firststage in a policy requiring the domestic production of Canadian television commercials.

Along with the CRTTC’s move toward a comprehensive system of broadcast advertising regulation, litigation has called into question the validity of provincial laws of general application in relation to broadcast advertising. In Kellogg’s Company of Canada v. The Solicitor General of Quebec, the applicability of Quebec’s Consumer Protection Act to television advertising is disputed. Although a lower court upheld the provincial legislation, the Court of Appeal overruled this decision in a majority judgment (2 to 1). The Court of Appeal argued both the exclusive authority of the federal parliament over the intellectual contents of broadcasts and the paramountcy of federal regulation in respect to same. An appeal of the Kellogg case was heard by the Supreme Court on March 15 and 16, 1977.

III. Relation to Federal Policies and Programs

Federal actions outlined aboveseem to derive from the pursuit of over-all policy objectives in the areas of communications and culture. In communications, the federal government is anxious to promote nation-wide communications systems offering a wide range of services at the lowest possible cost to users. Policies encouraging, inter-carrier competition, system interconnection, common user payment systems (electronic payments), and satellite communications represent steps taken to attain this objective.

The federal government is committed to establishing a strong and distinctive Canadian culture or identity. In order to achieve this, the federal government hopes to exert control over all forms of programming which will both reinforce its hold on the Canadian broadcasting system, and enable it to sponsor and control the introduction of pay television in Canada. For the same reason, provincial governments or their agents are refused the right to own or control cable distribution systems utilized for cable television. Federal cultural objectives are also used to control all forms of intellectual content distributed by broadcasting undertakings, including commercial advertising and closed-circuit cable, educational, or information services.

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IV. Degree and Adequacy of Consultation

The extent and adequacy of consultation between federal and provincial governments varies, depending on the policy field involved.

1. Pay television—Consultation on federal plans to introduce pay television have been minimal. In Saskatchewan’s case, consultation has consisted of a single telephone conversation and a letter from the federal minister.

2. Programming—Extensive consultation has taken place at the oflicials level between the federal government and some provinces. In one case (Manitoba) this consultation has resulted in an agreement providing for provincial government acceptance of certain programming criteria, and of federal control over programming services. In return, the federal government agreed to facilitate the removal of obstacles to carrier ownership of cable hardware in that province. As a result, recent CRTTC decisions awarding cable television licenses in Brandon, Portage, and Selkirk, Manitoba, were set aside by the federal Cabinet under section 23 of the Broadcasting Act.

As of this date, no other province has reached a similar accommodation with Ottawa on the programming issue. Most provinces, however, including Ontario and Saskatchewan, are continuing consultations with Ottawa on this and related matters.

3. Commercial advertising regulation—Little formal consultation has taken place with either the CRTTC or the federal government.

4. CRTTC control of cable distribution systems—Several provinces have frequently addressed the CRTTC both formally and informally on the matter. In this particular area, however, contacts have seldom taken place on a consultative basis. For the most part, the province is regarded as an appellant before a higher level of authority. In any event, the provinces have made little or no progress with the CRTTC on this matter.

V. Western Provincial Position

Although the western provincial governments share many common concerns with respect to federal intrusions in the communications policy field, they are not unanimous in their views. The positions described below take into account the views of all four western provinces.

1. Saskatchewan and Alberta recommend 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). Control and regulation of cable distribution systems should revert to the provinces; and the federal government should continue to regulate these systems only in relation to their use within the a Canadian broadcasting system.

2. Alberta, Saskatchewan, and Manitoba agree that cable services which do not directly involve the relay, retransmission, or amplification of broadcast signals should be subject to provincial control. Therefore, undertakings which offer these nonbroadcast services should submit to provincial regulation in so far as these services are concerned. British Columbia is sympathetic to this position.

3. Saskatchewan and British Columbia agree that the commercial content of advertisements used by broadcasting undertakings should be properly subject to provincial laws of general application relative to the matter of advertising. Therefore, formal delegation to an appropriate federal regulatory agency responsible for the implementation of provincial laws vis-à-vis broadcast licensees is possible, if arrangements with individual provinces are made. British Columbia has already experienced one jurisdictional problem and foresees future federal-provincial conflicts; it thus gives this issue a high priority.

4. Alberta, Saskatchewan, and Manitoba agree that educational communications carried out by means of cable or wire technology, should be exclusively a provincial concern. Again, British Columbia is sympathetic to this position.

5. Saskatchewan and Alberta agree that the provinces should continue to oppose any federal moves encouraging the interconnection of federally regulated carriers, which serve to diminish provincial, control over their telecommunications carriers, and which result in a deterioration of levels of service to remote and rural areas. British Columbia is sympathetic to these views.

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VI. Postscript to the “Communications” Paper

Since the four western provincial governments. developed, in a co—operative manner, this paper outlining federal-provincial issues in the communications field, the federal government has introduced new legislation (Bill C-43, An Act Respecting Tele-communications in Canada); and a federal-provincial conference on communications has been held. We have yet to examine the complexities of the proposed Act, and the results of the Council of Communications Ministers conference are in the process of being analysed.

We can, however, make a few general comments at the present time.

The Bill, as written, is somewhat Janus-like. On the one side, the federal government is allowing for forms of consultation and delegation through which responsibilities will devolve upon the provinces. On the other side, however, the Bill entertains and legitimizes processes’ inhibiting provincial governments from assuming their legitimate responsibilities in the communications field.

In some cases, the Bill not only detracts from the provinces’ ability to exercise their policy responsibilities, but it amounts to legitimizing what we regard as intrusions into areas under provincial jurisdiction. Two areas of special concern stand out. first, the scope of the powers given to the CRTTC to regulate broadcasting-receiving undertakings ; and secondly, the implications of the provisions of section 22 relating to the entry into the streets and lanes for the purpose of constructing telecommunication facilities.

On the matter of the CRTTC’s regulation of broadcasting-e-receiving undertakings under the proposed Act, we question what constructive purpose can be served by legitimizing, through statute, regulatory practices which are, at the very least, questionable on constitutional grounds. Let us take, for example, the provisions contained in section 32 (VII), empowering:

“. . . the Commission to make regulations . . . (VII) Respecting the provision of any services by broadcasting-receiving undertakings and establishing the terms and conditions applicable thereto.”

Many of these services are clearly outside the jurisdiction of both the agency and of the Parliament of Canada. It remains our position, therefore, that a federal regulatory agency alone cannot determine or regulate the entire range of services to be provided by broadcasting-receiving undertakings.

There exist very real dangers in awarding permissive statutory mandates to regulatory agencies in fields where constitutional responsibilities are in dispute. Instead, federal legislation should serve explicitly to delimit the scope of these agencies’ regulatory powers.

There is also some concern and question over the exact meaning and intent of section 22 and associated provisions. As the Act now reads, this section allows:

“. . . Any person empowered by special act to construct, operate and maintain the purpose of exercising those powers and subject to the provisions of the special Act, enter upon and break-up any highway, square, or other public place.”

Furthermore, the CRTTC assigned the task of regulating the terms and conditions under which such actions take place.

The rights to install facilities in streets and lanes has been rightly reserved to common’ carriers and public utilities. In order to have this right there must be special legislation. Accordingly the telephone, power, sewer, water, and gas utilities have been given the right by special provisions in provincial statutes. At the present time, there is no legislation, either federal or provincial, which gives this right to broadcasting-receiving undertakings. Such an approach is justified since cable companies are not effectively regulated with respect to rate of return or obligations of services. On this basis, we should oppose any attempt to grant cable companies the right of entry or access to the streets and lanes.

In the Railway Act, from which section 22 is purportedly taken, it is clear that the right to occupy the streets and lanes is restricted to federal telephone and telegraph companies. We would welcome an amendment to this effect in the new federal Bill. The purpose of such an amendment would be to clarify the fact that section 22 does not apply to, and cannot be extended to, cable companies.

To move to a more positive note, the Task Force welcomes those portions of the legislation which provide fora more effective provincial role in national communications policy formation and regulation.

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Section 7, which empowers the federal minister to conclude general agreements with the provinces allowing for mutual interdelegation of responsibilities, is therefore regarded as a step in the right direction. The provision for provincial representation on the federal regulatory agency (section 27), and the powers given to the minister under section 9 to direct the agency on matters respecting channel limitations and channel reservation, are also constructive measures in this respect.

Nonetheless, it would be unfair to leave consideration of this matter without uttering a word of caution. The mere opportunity for provincial input into federal regulatory and policy-making processes in itself will not resolve fundamental intergovernmental differences in communications. The existence of various consultative mechanisms will not obviate the need for a complete rationalization of governmental responsibilities in fields such as cable television and pay television, among others. Governments should continue to work toward this end.

Through a productive dialogue with the federal government on these and other matters pertaining to this legislation, our differences on the jurisdictional implications can be resolved.

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Demography and Immigration,
Manpower and Training,
Labour

POLICY AREA:
DEMOGRAPHY AND IMMIGRATION

Summary

The federal government has proposed a two-year process of consultation in demographic policy development. Most recently, the new Immigration Bill involves a number of significant amendments to existing immigration policy and provides for provincial input in determination of the volume, distribution, and settlement of immigrants.

The provincial position is that demographic and immigration policies must be co-ordinated with regional economic development, housing programs, transportation programs, and urban development and land policies.

These policies must be developed only with the full and active co-operation of the provinces.

I. Intrusions

Early in 1975 the Prime Minister suggested that the federal and provincial governments work together to develop a national demographic policy, which would set out their joint objectives regarding population growth and objectives. Because of the many conceptual problems with the federal government’s initial View of demography as an “umbrella policy” guiding social, economic, and environmental directions, a change in focus resulted. Now, the main consideration is population policy.

The intent of a demographic policy is to establish objectives regarding population size, rate of growth, distribution, and composition. These population characteristics have a considerable effect on many areas of government concern, including education, health and social services, housing, transportation, industrial development, and environment. Population objectives should be based on some knowledge of the economic, social, and environmental implications of population trends, an evaluation of their desirability, and the identification of preferred options.

Not only does population afiect other policy areas; it is also affected by them. Industrial development, transportation and housing policies, for instance, can influence population trends. Unless there is some awareness of these inter-relationships these policies could contribute to undesirable population changes. A demographic policy could provide a framework for co-ordinating other policies in so far as those policies affect or are afiected by population.

The federal government has proposed a two-year process of consultation in these matters, many aspects of which are clearly within provincial jurisdiction.

The new Immigration Bill affirms the objectives of Canadian immigration law, attempts to remove inequities that exist in present law, includes provisions for areas of immigration policy (such as the refugee a issue) not previously considered in the legislation, and provides for development of limited federal-provincial consultation on some immigration questions. The nature of this consultation is of particular importance to provincial interests.

II. Impact on Provincial Policies and Programs

Although demographic policy is still in the developmental stage, conflicts could develop between federal priorities and provincial planning. Specific areas of concern arethe effects of population on transportation policy; the impact on urban development and land use, the effect on population growth and distribution of environmental policies; the impact of population growth on industrial development; economic factors involved in population change; and the impact of housing programs on population.

III. Degree and Adequacy of Consultation

To date, it is generally considered that the consultations on demographic policy have been adequate. As well as aiding federal understanding of provincial priorities, these discussions have encouraged the provinces to take an in-depth look at the vast number of problems in the policy area.

There have been a number of federal-provincial meetings of ministers and officials in addition to a major federal policy statement. The provinces consider consultation on demographic policy to be in the initial stages.

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The new Immigration Bill provides’ for consultation, but the extent of this consultation is limited. Section 109 authorizes consultation on two aspects of immigration particularly significant to provincial interests: “adaptation of permanent residents to Canadian society”, and “assessment of regional demographic requirements.”

However, the wording of this section is vague and omits mention of a number of other aspects of immigration policy requiring provincial input. Consultation on “adaptation of permanent residents” implies but does not clearly specify consultation on the array of problems encountered by the provinces in settling immigrants. Nor does “assessment of regional demographic requirements” specify with sufficient clarity the various components of regional demographic requirements that the provinces have an interest in controlling; notably, numbers of immigrants, and immigrant employment qualifications. Those aspects of immigration policy requiring provincial input but not mentioned in section 109 include issuance of employment visas, recruitment and selection of immigrants, advance notice of refugee arrival, payment of social assistance to refugees prior to their finding employment, and designation of communities.

In addition, the Bill does not suggest a mechanism for federal-provincial consultation. It is of paramount importance to provincial interests that this mechanism ensure acceptance of provincial judgments on matters of significance to provincial designs.

IV. Western Provincial Position

It is recommended that the provinces co-operate with the federal government in developing a national demographic policy. To do this effectively, a it is necessary to examine this initiative from a provincial perspective and to establish provincial objectives. It would beunsatisfactory if only the federal government was involved in developing the policy, leaving it to the provinces to provide the infrastructure. Some of the areas affected by demographic policy fall within strictly provincial jurisdictions; others are within federal jurisdictions. Thus, any national policy 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 permittingconsideration of the broad range of provincial interests in immigration policy and ensuring acceptance of provincial concerns on issues of critical importance to the provinces.

POLICY AREA:
MANPOWER AND TRAINING PROGRAMS

Summary

Three recent federal initiatives in the manpower and training policy area are of concern. These initiatives involve community employment strategy, the adult occupational training agreement, and apprenticeship training programs.

The provincial position is that these initiatives evolved without adequate provincial input. It is suggested that a comprehensive federal-provincial agreement be sought which would outline their specific functions in the policy areas of manpower and training.

I. Intrusions

Since both the federal and provincial governments have legitimate responsibilities in the manpower and training policy. area, the potential for conflict always exists. There is concern over the following recent federal initiatives:

1. Community Employment Strategy—The concept of community employment was included in the Federal Government Health and Welfare Orange Paper of 1973. CBS is an employment strategy whereby a community plans, develops, and administers its own proposals for creating employment opportunities. The fundamental idea of CES is that the appropriate focal point for defining employment problems and proposing plans to aid people is the community itself.

2. Adult Occupational Training Act—The federal government has proposed new accounting procedures within the AOT agreement which could require the disclosure of post—secondary institution costs. There is also an apparent shift from institutional to industrial training with an attendant decrease in federal expenditure for some.

3. Apprenticeship Training Program—The federal government is moving toward direct control of apprenticeship training.

II. Impact on Provincial Policies and Programs

1. Community Employment Strategy—This strategy is still being developed and refined. There is some concern that through this initiative the federal

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government may exert undue influence on provincial activities by creating expectations within the communities without adequate consultation with the provinces. Due to the undefined nature of the division of responsibility between the two levels of government, jurisdictional disputes may develop. The provinces also feel that continued federal support for the program is uncertain and thus there is the need for a formal encompassing, agreement before the CES initiative is undertaken.

2. Adult Occupational Training Act—The Adult Occupational Training Act is the general rubric under which the federal government has mounted two major occupation training programs; one promoting institutional training and one providing industry based training.

While the training is undertaken through agreements with the provinces, there has been some suggestion from provincial quarters that these training programs constitute a fundamental federal intrusion into the provincial education jurisdiction.

3. Apprenticeship Training Program—While apprentice training falls fundamentally within the jurisdiction of the provinces, the federal government makes a considerable’ contribution to apprentice training and has suggested that improvements are required. To this end, the federal government has urged greater consultation over matters concerning apprentice training. This may be construed as an intrusion into an area of provincial competence.

III. Degree and Adequacy of Consultation

Although some consultation has occurred, it is felt generally these initiatives in the manpower area. evolved without adequate provincial input. In, some cases, the intentions of the federal initiatives were not fully articulated. In others, the federal government appeared to develop these policies unilaterally and then impose their decisions on an “after the fact” basis.

IV. Western Provincial Position

The federal government involvement in the policy areas of manpower and training has had a tendency to overlap with the jurisdictional mandate of the provinces. As a result it is suggested that a comprehensive agreement between the federal and provincial governments outlining their specific functions be sought.

In many cases, the federal government has taken the initiative in identifying needs and creating expectations but has failed to follow through with programs resolving these problems. Closer co-operation between these levels of government need to be achieved. At the same time federal programs must be flexible enough to allow for provincial variations. Some bilateral agreements are presently in place and could be expanded.

It is recommended regarding the CES and the Apprenticeship Program that the provinces demand the primary responsibility for these areas with respect to strategy development and program management.

POLICY AREA: LABOUR

Summary

This section describes the potential impact of eight tentative federal program proposals in this area. All of these are new initiatives in areas that have been relatively free from federal influences, and arise from Labour Canada papers distributed in the fall of 1976, Papers Respecting the Post Control-Period.

The provincial position is that the impact of these programs on provincial jurisdiction must be studied carefully. There is concern that the federal initiatives. may be in conflict with provincial policy objectives; the new federal programs may exert pressure on provincial administrations with respect to the development of parallel provincial sector programs; and that the expectations may be created that the provincial governments will continue federal programs which may be terminated.

I. Intrusions

The most recent federal initiatives concerning the general area of labour were included in Labour Canada papers distributed to theprovinces in the fall of 1976, Papers Respecting the Post-Control Period. These papers proposed eight specific programs involving educational leave, establishment of a collective bargaining information centre, establishment of joint labour-management safety and health committees, recruitment and training of conciliation and mediation officers, study and implementation of increased worker participation, labour education, labour standards, and grievance arbitration.

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II. Impact on Provincial Policies and Programs

These eight programs emerged fromthe DM-10 Committee on the post-control period and appear to represent the beginning of a concerted effort to put the collective bargaining system on a different footing. One of the primary federal objectives seems to be to encourage the parties in the Canadian industrial relations scene to look at increased worker participation.

Since all the programs are new initiatives in areas that have been relatively free from federal influences, there is general concern over the whole package. However, until the proposals are more fully developed, it is difficult to assess the impact they will have on provincial policies and programs.

As the proposals, stand at present there is the potential for considerable jurisdictional overlap, and duplication of existing provincial programs. Some of the proposals may place new demands on provincial governments. In many cases, the value and benefits to be derived from the proposals are in doubt.

III. Degree and Adequacy of Consultation

The package was introduced in a general sense by the Minister of Labour (Canada) at the federal-provincial conference last fall. Since that time consultation has been undertaken bilaterally. The federal government. indicated at these meetings that there would be further consultation on the development of proposals that affect provincial jurisdiction.

These meetings provided an opportunity for explanation of the situation and for expression of initial provincial reactions and questions respecting the proposals. There has been no provincial commitment to specifics, only a general commitment to continue co-operation in the development of proposals that would be consistent with provincial policy and would improve general labour-management relations.

IV. Western Provincial Position

It is suggested that the provinces continue to co-operate in the, development of these initiatives, but careful assessment should be made of the impact on provincial jurisdiction. If the provinces do not become involved in the assessment and development of these concepts the federal government may fill the void. This could result in these future initiatives reflecting onlythe federal viewpoint. The provinces must seek to exert their influence in order to protect provincial flexibility and jurisdiction.

Specific concerns are as follows:

a) The emergence of the federal presence industrial relations in areas which are now under provincial jurisdiction.

b) The extent to which the federal initiatives may be in conflict with provincial policy objectives.

c) The pressures which new federal programs may exert on provincial administrations, with respect to the development of parallel provincial sector programs.

d) The creation of the expectation that provincial governments will continue federal programs which may be terminated.

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Administration of Justice

Summary

Generally speaking, federal activities identified in this paper as intrusions represent a pervasive federal interest to expand a federal presence throughout the justice system.

Although the Constitution entrusts to the Parliament of Canada the-responsibility to make the criminal laws (section 91 (27)), the Constitution imposes on the provinces the responsibility to administer and enforce those laws as part of the administration of justice (section 92 (14)). Oftentimes federal law-making has direct cost implications to the provinces; a factor which federal authorities often overlook. 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.

Apart from the above, the provinces are concerned with recent federal legislative actions (some of which are identified in this paper) that clearly appear to be beyond federal legislative competence to the detriment of long established provincial practice.

I. Federal Legislative Intrusions

Federal intrusions, commencing with those areas a where the western provinces have found highest consensus, may be listed as follows:

1. The Federal Court of Canada.
2. Prosecutorial Responsibility.
3. “Young People in Conflict With the Law” Legislation.
4. Family-Law.
5. “Peace and Security” Package—Gun Control Legislation.
6. RCMP Matters.

II. Impact on Provincial Policies and Programs

1. THE FEDERAL COURT OF CANADA.

The Federal Court Act, which came into effect in 1971, purports to give to the Federal Court of Canada jurisdiction in areas previously exercised by the Superior and County Courts of the provinces. Some provisions conferring criminal and civil jurisdiction on the Federal Court appear to be clearly unconstitutional and the recent decision of the Supreme Court of Canada in the MacNamara Construction case supports that view. Those sections of the Act which appear to be beyond the authority of the Parliament of Canada include section 17 (4) (a) and (b); sections 18, 28 (1), 29, and section 3 which purports to make the Federal Court a court of criminal jurisdiction.

Apart from constitutional considerations, the purported vesting of jurisdiction in the Federal Court has serious practical disadvantages to the administration of justice in the hands of the provinces and to the citizens of Canada generally.

The nonconstitutional objections include:

(i) The creation of a dual court system leading to uncertainty among lawyers and litigants as to which court has jurisdiction in particular cases.

(ii) The substantial costs to be borne by the taxpayer in establishing the Federal Court system when the established Superior and County Courts of the province can effectively meet the need.

(iii) The multiplicity of proceedings resulting from A a divided jurisdiction between the Federal Court and the Provincial Courts.

The provinces unanimously expressed these concerns to the Federal Minister of Justice at the Federal-Provincial Conference of Attorneys-General in Ottawa in March 1975. In response, the Attorney-General of Canada indicated that he had been reviewing the role and jurisdiction of the Federal Court of Canada and the Conference agreed to establish a group of representatives to discuss possible changes in the jurisdiction of the Court.” Those discussions took place but no federal amendments limiting the jurisdiction of the Federal Court have yet been forthcoming.

2. PROSECUTORIAL RESPONSIBILITY

Historically and constitutionally the provinces are responsible for the prosecutorial role in Canada. Section 92 (14) of the British North America Act gives the provinces the power to administer justice, both civil and criminal, in the provinces. Historically, since Confederation provinces have been administering the criminal law of Canada in the widest sense except in those cases Where the provinces have explicitly or expressly given the prosecutorial function to the federal government.

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However, in the past few years, the federal government has asserted its right to prosecute the law and has, in effect, asserted that the provinces exercise the right to prosecute the criminal law, not on the basis of a right given under the Constitution, but at the suflerance of the federal government. Such a position is not only wrong constitutionally but it belies the historical fact that since Confederation the provinces, at great expense, have prosecuted the criminal law in its widest sense.

There are serious disadvantages in having a federal prosecutorial role. For the provinces to prosecute Criminal Code offences but not drug traffic and drug-use offences makes little sense. Those persons involved in this type of criminal activity are also usually involved in other criminal activity as well. There is no rational explanation, nor can an intelligent community understand why, the same criminal must be prosecuted for a drug offence by a prosecutor appointed by one level of government and for a Criminal Code offence by a prosecutor appointed by another level of government.

It is the provinces’ view that the administration of justice is a provincial responsibility and any prosecution for any criminal offence in the widest constitutional sense should be conducted by or under the authority of the provincial Attorneys-General. Today and in the future the administration of criminal justice must remain in provincial hands. It can best be administered at the local level having regard to local conditions and circumstances.

Moreover, the duplication of effort in the field of prosecution services creates unnecessary public expense in the operation of the courts and the development of court services.

3. “YOUNG PEOPLE IN CONFLICT WITH
THE LAW” LEGISLATION

This federal draft legislation, representing a comprehensive federal approach to juvenile legal problems, has been uniformly resisted by all four western provinces as its enactment would escalate provincial administrative costs and force changes in existing provincial legislation. New federal proposals are expected imminently, however, in which case respective provincial positions may appreciably change.

4. FAMILY LAW

This developing major intrusion can be categorized into a number of subject concerns—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 provinces are chiefly concerned that the enactment of federal recommendations would allow for the entry of the federal government into the property field, a “traditionally” provincial jurisdiction. Judicial appointments would also be made federally, thus potentially strengthening the federal position.

5. “PEACE AND SECURITY” PACKAGE—GUN
CONTROL LEGISLATION

This package comprises a series of federal proposals and recommendations which encompass the concerns of the massive field of corrections and related matters, for example, amendments to the Protection of Privacy Act. Provincial interest centres on the cost of implementing aspects of the package and, in particular, gun control legislation which has recently been the subject of some discussion. In general, the provinces are agreed that federal-provincial dialogue on package specifics has to date been satisfactory.

6. RCMP MATTERS

The federal component of 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.

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 he a provincial responsibility while others are prepared to continue the present practice or abide by changes made in accordance with the Marin Commission recommendations.

III. Relation to Federal Policy

The Federal Court Act would seem. designed to remove from the inherent jurisdiction of Supreme Courts of the Provinces as many of the activities of the federal government, its boards, agencies, and commissions

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as possible and place them in the hands of a separate court system which is more amenable to federal control.

Federal-provincial jurisdictions are not clearly defined with respect to prosecutorial responsibility. It is thus easier to expand and manipulate the federal power base in that area, and the provinces agree that federal authorities are attempting gradually to assume greater powers throughout the entire judicial system by this means.

The development of new programs to improve the current justice system represents another activity by the federal government whereby federal control of legislation is assured while the provinces assume the brunt of program costs. Provincial authorities oftentimes find themselves agreeing in theory with federal government proposals, and discussions of such program proposals as the federal law commission’s report on “Family Law” have been extensive, if heated. A similar situation exists with respect to “Young People in Conflict With the Law” draft legislation where, as mentioned earlier, some changes in federal recommendations are anticipated as a result of federal-provincial discussion.

Gun control legislation is a special instance where the administration of a particularly controversial issue has been assigned to the provinces. Provincial authorities are resisting a purely administrative role, in part because again their administrative costs would increase. Secondly, the legislation, although unpopular, could not be adopted separately’ by the provinces to meet the interests and needs of their residents.

The expansion of the federal component of the RCMP and the implications of the Marin Commission Report are less prominent intrusions and the provinces are not agreed on their potential effect. Generally speaking, the federal government is strengthening its policing function and insulating RCMP activities from provincial control, both actions which could lead to a reduction of provincial law enforcement priorities. Some administrative problems, experienced as a result of lack of federal-provincial co-ordination, have occurred to date.

IV. Degree Adequacy of Consultation

Generally speaking, federal-provincial consultation on the broad subject concerns encompassed by this paper have been satisfactory. Both the provinces and the federal government are agreed on the need for an improved justice system i and much federal and provincial thinking on specific issues is similar.

The Federal Court Act and the matter of prosecutorial responsibility have been the subject of federal-provincial conferences, and although discussions are proceeding, the provinces are deeply concerned about the implications of these matters; control of the justice system is at issue.

Although the provinces have endorsed the general concepts of the federal law commission’s report on “Family Law” they have not reached agreement concerning the implementation of same. Discussion of the issues has been extensive, chiefly by means of federal-provincial conferences, and satisfactory. Further talks are expected, however, before any action is taken on federal proposals. The provinces see no constitutional obstacle in all family law matters, including divorce, being dealt with by one unified court.

Both the “Peace and Security” package and “Young People in Conflict With the Law” are controversial program proposals, aspects of which have been the subject of much exchange between the federal government and the provinces. Alternative federal proposals are to be circulated shortly and the position of some provinces on specific matters may thus be appreciably, altered. Consultation has nonetheless been extensive and both federal and provincial authorities are attempting to reach agreement on concerns which could affect the entire delivery of justice mechanism.

The present expansion of the federal component of the RCMP is an ongoing federal program which has not been the subject of federal-provincial discussion. The Marin Commission Report, on the other hand, has been released to the public. Because of differences of opinion concerning the possible detrimental affects of this program and report, respectively, the provinces do not agree that federal-provincial consultation should be initiated; if discussions are thus undertaken, provinces should do so individually, in accordance with their concerns.

V. Suggested Provincial Position

It is the recommendation of the provinces that federal authorities by statutory amendment significantly lessen the jurisdiction of the Federal Court Act and define federal prosecutorial responsibility, if any. Provincial jurisdictional interests might then be presented and any remaining ill-defined concerns made the subject of discussion.

Federal recommendations on family law must not intrude into provincial jurisdiction but should be complementary. Specifically, in the area of family property where all provinces are examining provincially based strategies, the federal government should make no attempt to override the provinces.

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As mentioned earlier, new federal proposals pertaining to “Young People in Conflict With the Law” and the “Peace and Security” package are to be released shortly. The provinces agree, therefore, that no western provincial position be adopted until such time as the proposals have been reviewed and respective provincial positions adopted.

The expansion of the federal component of the RCMP, in the opinion of the provinces, should parallel the delivery of general police priorities. In respect of the Marin Commission Report, provincial personnel have already or are presently prepared to incorporate some or all of the report’s recommendations into provincial practices, under provincial jurisdiction.

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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 9 of the approximately 10 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.

In Central Canada Potash Co. Ltd. v. The Government of Saskatchewan (which has yet to be appealed to the Supreme Court of Canada) the Federal Government went so far as joining Central Canada Potash Company, not as an intervenor as is the usual procedure, but as a co-plaintiff at trial and on appeal in that company’s challenge to Saskatchewan’s potash prorationing legislation.

As Premier Blakeney of Saskatchewan stated at the first Ministers’ Meeting of December 13 and 14, 1976, the federal position in these current resource cases demonstrates a “systematic and deliberate attempt todestroy, through court action, the provincial rights of resource ownership. The direct and belated federal challengeto prorationing now is an obvious attempt to undermine our ability to regulate resource production . . . these actions by the federal government represent an aggressive attack on Saskatchewan’s resource policies. . . . The political solution requires the federal government to drop its aggressive antiprovincial stance in the taxation and control of natural resources.”

There follows a list of those cases in the Supreme Court of Canada since January 197 3 where, with one exception, the federal government has opposed provincial legislation:

1. Burns Foods “Limited et al v. Attorney-General for Manitoba et al, December 21, 1973 [1975] 1 S.C.R. 494;

Legislation challenged: Manitoba Regulation 97/72 made pursuant to The Natural Products Marketing Act, R.S.M; 1970, c. N20;

Grounds on which legislation challenged: Direct interference with interprovincial trade.

Outcome: Legislation held invalid.

2. Interprovincial Co-operatives Ltd. and Dryden Chemicals Ltd. v. The Queen in Right of the Province of Manitoba, March 26, 1975 [1976] 1 S.C.R. 477;

Legislation challenged: The Fishermen’s Assistance and Polluters’ Liability Act, S.M. 1970, c. 32, s. 4;

Grounds on which legislation challenged: In accordance with its residual power over matters of interprovincial concern such as the pollution of interprovincial rivers the legislation was within the exclusive federal field.

NOTE—In this case Canada argued in favour of the provincial legislation but it was still held invalid.

3. Morgan and Jacobson v. The Attorney-General for the Province of Prince Edward Island et al, June 26, 1975;

Legislation challenged: The Real Property Act, R.S. P.E.I., c. 138, s. 3;

Grounds on which legislation challenged: Legislation in pith and substance in relation to citizenship and aliens.

Outcome: Legislation held valid.

4. Natural Parents v. Superintendent of Child Welfare . et al, October 7, 1975 (19.76) 60 D.L.R. (3d) 148;

Legislation: The Adoption Act, R.S.B.C.. 1960, c. 4, is not inconsistent with the Indian Act;

Ground: Legislation deprived Indians of their special rights under the Indian Act.

Outcome: Legislation held valid.

5. Dilorio and Fontain v. Warden ofthe Common Jail, of the City of Montreal, April 1, 1976;

Legislation challenged: The Police Act, 1968, Quebec, c. 17;

Argument: Administration of criminal justice is for Parliament alone to prescribe.

Outcome: Legislation held valid.

[Page 51]

6. Alex Tomko v. Labour Relations Board (Nova Scotia) et al, December 19, 1975;

Legislation challenged: Trade Union Act, S.N.S., 1972, c. 19, s. 49;

Ground on which legislation challenged: Purports to confer on the Construction Industry Panel of the Labour Relations Board judicial powers and functions which under section 96 can only be exercised and conferred upon a court appointed by the Governor-General in Council.

Outcome: Legislation held valid.

7. Amax Potash Ltd. v. Government of Saskatchewan, October 5, 1976;

Legislation challenged: The Proceedings Against the Crown Act, R.S.S. 1965, c. 87, s. 5 (7);

Argument: Provincial legislature cannot do indirectly what it cannot do directly.

Outcome: Legislation held invalid.

8. Canadian Indemnity Co. v. Attorney-General of British Columbia, October 5, 1976;

Legislation challenged: Automobile Insurance Act, S.B.C. 1973, c. 6;

Argument: Legislation in relation to inter-provincial trade directed at federally incorporated companies.

Outcome: Legislation held valid.

9. Robinson v. Countrywide Factors Ltd., January 22, 1977;

Legislation challenged: The Fraudulent Preferences Act, R.S.S., c. 397;

Grounds: Bankruptcy and insolvency legislation outside provincial authority.

Outcome: Legislation held valid.

10. Canadian Industrial Gas & Oil Ltd. v. The Government of Saskatchewan et al, heard November 1976 (awaiting decision);

Legislation challenged: The Oil and Gas Conservation, Stabilization and Development Act, 1973, S.S. 1973-74, c. 73 and The Mineral Resources Act, S.S. 1973-75, c. 64 and regulations;

Grounds on which legislation challenged: Constitutes a scheme for imposing an indirect tax, relates to the regulation of trade and commerce and interferes with interprovincial trade.

[Attorney-General of Canada attempted unsuccessfully to be joined in the Court of Appeal as a Plaintiff-Appellant instead of just an Intervenant.]

Central Canada Potash Co. Ltd. v. The Government of Saskatchewan (not yet appealed to Supreme Court of Canada).

Saskatchewan’s prorationing plan of potash product attacked. The Attorney-General for Canada took the unprecedented step of becoming a plaintiff in this action, called witnesses and adduced evidence at the trial thus influencing the set of facts on which the case is founded.

(Legislation held valid by the Saskatchewan Court of Appeal.)


Appendix I

[Page 52]

Province of British Columbia
OFFICE OF THE PREMIER

Brandon, Manitoba,
May 5, 1977.

The Right Honourable Pierre Elliott Trudeau,
Prime Minister of Canada,
OTTAWA, Ontario.

My Dear Prime Minister:

On behalf of the Western Premiers, I am forwarding a copy of the “Report of the Western Premiers’ Task Force on Constitutional Trends, May 1977”.

At last year’s Conference in Medicine Hat in April, 1976, the Western Premiers expressed concern over recent federal legislative moves into areas of provincial jurisdiction. It was agreed that these apparent intrusions called for a careful and coordinated analysis. Accordingly, an interprovincial task force was established to prepare a detailed inventory and to report back with recommendations.

We have today received and considered the Task Force Report, which reflects a high degree of consensus among all four governments. It was agreed that the Report should be forwarded to you, in the hope that it might make a positive contribution toward a resolution 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. “Accordingly, it would be helpful if you would designate an appropriate federal official or officials with whom this matter may be further refined.

I am sending copies of the Report to our colleagues in the other provinces. As well, it is our intention to release it to the public forthwith.

I look forward to hearing from you.

W. R. Bennett,
Premier of British Columbia

Parliament Buildings, Victoria, British Columbia V8V 4R3


Appendix II

[Page 53]

COMMUNIQUE
May 5, 1977

REPORT OF THE WESTERN PREMIERS’
TASK FORCE ON CONSTITUTIONAL TRENDS

At last year’s Conference, in April 1976, the Western Premiers expressed concern over recent federal legislative moves into areas of provincial jurisdiction. They agreed that these apparent federal intrusions called for a careful and co-ordinated analysis. Accordingly, an intergovernmental task force was established to prepare a detailed inventory and to report its findings and recommendations to the 1977 Conference.

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 where, in the provinces’ view, recent actions by the federal government had created, or were likely to create’ undesirable friction.

The report deals with the following policy areas:

—consumer and corporate affairs
—nonrenewable and renewable resources
—housing, urban affairs, and land use
—economic development
—communications
—manpower, training, and labor
—administration of justice, and
—interventions by the Federal Government before the Supreme Court of Canada.

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.

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