Question 8: Opting Out is the Wrong Tool

Question 8

Do you support the Government of Alberta working with the governments of other willing provinces to amend the Canadian Constitution to allow provinces to opt out of federal programs that intrude on provincial jurisdiction such as health care, education, and social services, without a province losing any of the associated federal funding for use in its social programs?

• The federal government has an interest in national programming so that all Canadians enjoy relatively equal access to the social programs it views as important to the wellbeing of citizens, regardless of where they live.

• The question seeks a constitutional amendment and it’s hard to imagine parliament would agree to a change which limits their power to enact programs.

• The better path is to keep negotiating the terms of federal-provincial cooperation, as governments have done for decades.

Background

In the power-sharing arrangement between the federal and provincial governments, the Constitution provides that the federal government can raise money through its power to tax citizens, both directly, where the tax is demanded of the very person intended to pay it (for example, income tax), and indirectly (for example, customs duties and the goods and services tax (GST)). Provinces can also raise money, but only through direct taxation within the province, such as personal income tax, retail sales tax, and resource royalties.

Building on its taxing and appropriation powers, the federal government is generally understood to have a “federal spending power,” giving it the ability to spend the money it raises and to make grants to provinces or individuals, even in respect of subjects that fall under provincial jurisdiction. The spending power is not defined in the Constitution. It is an implied power, located in a combination of provisions: public property (s 91(1A)), taxation (s 91(3)), and the appropriation of federal funds (s 106).

The Supreme Court of Canada has never definitively ruled on its existence or limits, but appellate courts have upheld it: in Winterhaven Stables, the Alberta Court of Appeal confirmed that Ottawa may spend the money it properly raises and may attach conditions to that spending, so long as the conditions do not in substance amount to regulating a matter outside federal authority.

The democratically elected government of the day may pass laws and set policies to advance the mandate given to it by voters. Its spending choices range from economic ones, such as the purchase of the Trans Mountain pipeline, to social ones such as childcare, health care, pharmacare, and dental care. Some of these areas fall under provincial constitutional authority, which is precisely why Ottawa uses the spending power rather than a direct power to legislate.

Why does the federal government get involved in areas of provincial authority, such as health care, post-secondary education, childcare, and pharmacare?

The federal government has an interest in national programming so that all Canadians enjoy relatively equal access to the social programs it views as important to the wellbeing of its citizenry, regardless of where they live or what their means may be, so that there are national standards for the basics necessary to live a life with dignity. Some provinces have resisted federal conditions on the use of these funds, for reasons that include the long-term sustainability and design of the programs.

Do the provinces have a say?

Yes. For decades, and to this day, federal social objectives have been pursued through the spending power with varying degrees of collaboration with the provinces, expressed in negotiated multilateral and bilateral agreements that provide for reporting and accountability. Courts have confirmed that Ottawa may set, and later change, the conditions attached to these transfers.

In a number of areas, Quebec has secured asymmetrical arrangements with compensation. Canada is, in this sense, like a family of individuals with different philosophies and politics, pooling resources so that each member has enough support to meet basic needs and pursue the life they want, while remaining, constitutionally, equal and coordinated partners rather than dependents.

What is a recent example of the federal spending power used for the benefit of all Canadians?

A recent example is the federal government’s April 2021 commitment to drastically reduce childcare costs across the country. Childcare and family advocates celebrated it as an historic investment. Premier Jason Kenney initially decried the program as supporting only “nine-to-five, urban, government and union-run institutional daycare options,” but Alberta ultimately signed on, illustrating both the friction the spending power can create, and the benefits provinces secure by participating.

What would Question 8 actually require?

This is the part the question does not spell out. Question 8 does not ask for a policy change; it asks for a constitutional amendment. Amending the division of powers engages Part V of the Constitution Act, in particular the general (“7/50”) amending formula: it requires resolutions of the Senate and House of Commons and of the legislative assemblies of at least seven provinces representing at least fifty per cent of the population. Alberta “working with willing provinces” could not achieve this on its own; the federal Parliament would also need to agree; a significant hurdle, since it would mean Ottawa consenting to limits on its own programs.

The closing words of the question deserve particular attention: opting out “without a province losing any of the associated federal funding.” Much of that funding is conditional precisely because it secures the national standards the programs are designed to deliver. In practice, the question asks Parliament to continue the funding while a province steps away from those shared standards.

What does the question really ask?

At its core, Question 8 asks Albertans to support the province’s ability to set its own course on social priorities pursued nationally, while continuing to receive the associated federal funding. Those priorities have historically reflected widely shared Canadian values such as supported childcare and accessible, publicly funded health care, aimed at ensuring that every Canadian, regardless of circumstance, has the essentials to live a life with dignity.

Our view

The concern behind Question 8 is worth taking seriously, and provinces are right to press for a fair partnership. But this particular remedy is the wrong tool for the problem. The better path is to keep negotiating the terms of federal-provincial cooperation, as governments of all stripes have done for decades.

We are voting NO on Question 8.