Canada

IN SEARCH OF SOCIAL UNION

Ottawa and the provinces inch towards a deal

CHRIS WOOD February 8 1999
Canada

IN SEARCH OF SOCIAL UNION

Ottawa and the provinces inch towards a deal

CHRIS WOOD February 8 1999

IN SEARCH OF SOCIAL UNION

Canada

Ottawa and the provinces inch towards a deal

CHRIS WOOD

Perhaps it was the rain that began Thursday morning in Victoria and continued through most of last week’s meeting of cabinet ministers and senior mandarins from Ottawa, the 10 provinces and two territories.

Perhaps it was the location—a windowless meeting room sandwiched between a wine show and an independent film festival at the Victoria Conference Centre. Or maybe it was the ghost of an earlier meeting in the B.C. capital, in 1971, when a federal-provincial agreement seemed at hand—only to slip away a week later when then-Quebec premier Robert Bourassa backed away from the Victoria charter, as it was called. Whatever the cause, by the time 2xfc days of talks ended last weekend, the momentum that had appeared to be building for Ottawa and the provinces to forge a new framework for co-operation on national social programs, had slowed. In the end, provincial ministers of intergovernmental affairs and Ottawa’s point player on the file, federal Justice Minister Anne McLellan, went home able to agree only that, in many key areas, they still disagreed. ‘We have made some significant progress,” McLellan insisted. “But there is still more work to be done. As I’ve said before, there are no artificial deadlines.”

But there was no masking the fact that last week’s conference did not make the advances many had hoped for when the process began.

Saskatchewan intergovernmental affairs minister, Bernhard Wiens, who co-chaired the talks with McLellan, acknowledged as much. “The good news is we’re down to the details,” Wiens said. “The bad news is we’re down to the details.” And despite working sessions that lasted until midnight on Friday and resumed at 9 o’clock on the unscheduled third morning of talks, by the time discussions ended at noon on Jan. 30 some players insisted they had seen little progress at all. On Quebec’s key issue of restraining Ottawa from spending in areas of provincial jurisdiction, that province’s intergovernmental affairs minister, Joseph Facal, fumed: “I have not seen a millimetre of movement. I fear Madame McLellan has a mandate not to budge on that question—and as long as the federal negotiator does not move at least a little on this, we won’t accomplish much.”

If the talks ended without result, they also managed to avoid a complete breakdown. Both federal and provincial participants left Victoria promising to meet again late this week in Toronto, with even Facal saying, “I haven’t given up hope.” But the inability to reach a deal in Victoria lessens the chances for an agreement before federal Finance Minister Paul Martin presents his budget on Feb. 16raising fears among some provinces that Ottawa might use the budget to launch new social initiatives, such as a national home-care program, that could make a deal on the social union even more difficult.

While companion talks have also been under way on a parallel health accord—aimed largely at assuring Ottawa that any new money transferred to the provinces for health care will actually be spent for that purpose—the negotiations on a new social-union framework were never likely to have a dramatic or immediate impact on most Canadians’ lives. They do not, for example, envisage any specific new social programs. Even so, the negotiators’ inability to close a deal in Victoria takes some of the steam out of what many had viewed as one of the most positive trends in federal-provincial relations in a decade.

The talks have their origins in the Calgary Declaration—a provincial overture to Quebec concluded in September, 1997. Along with offering to acknowledge Quebec’s “unique character” within Confederation, that declaration contained a promise by the nine provinces to work towards an end to decades of friction with Ottawa over social programs—such as health and higher education—most of which rely on federal funding but are delivered by the provinces. The initiative received a boost in December that year, when Prime Minister Jean Chrétien and Saskatchewan Premier Roy Romanow, who are old friends, discussed the idea. Shortly afterwards, Romanow took the lead in canvassing other premiers on their support for the notion, while Chrétien assigned McLellan, regarded as one of his most able ministers, to represent Ottawa.

The talks moved fitfully through last year. In August, they appeared to take a jump forward when Quebec Premier Lucien Bouchard joined other premiers in Saskatoon in tabling a position paper which, for the first time, presented Ottawa with a united provincial front on the issue. Among the key elements was a demand that if Ottawa launches new social programs in the future, it must give any province that establishes its own program in the same area its share of federal funding—a longstanding Quebec demand. Optimism peaked again last month during a federalprovincial meeting in Halifax, where McLellan delivered a verbal summary of a federal offer to the provinces. It amounted to a promise to introduce no new shared-cost or conditional social programs (those for which Ottawa offers money to the provinces, but only if it is spent for specific purposes), unless a majority of the provinces agreed. As well, McLellan said Ottawa was prepared to offer financial compensation to any province that offered a program of its own comparable to a federal initiative. The offer seemed to energize the negotiations.

“We came here looking for a signal of openness from the federal government,” said Facal at the time, “and we received that signal.”

The upbeat tone was sustained in an exchange of letters between Romanow and Chrétien late in January. Writing on behalf of the premiers, Romanow promised that whatever new money Ottawa puts into health care in the budget—perhaps as much as $1.5 billion—would be spent on core health services. “Premiers and territorial leaders,” Romanow’s letter added, “have instructed our negotiators to intensify their work in the coming weeks on a draft social-union framework agreement.” Three days later, Chrétien wrote back, lauding the premiers’ “spirit of collaboration and partnership.”

Then, just days before the Victoria meeting, the wheels began to come off the emerged ing consensus. Provincial I spokesmen insisted that a I written version of Ottawa’s I proposals offered much less I than McLellan had appeared g to hold out in Halifax. And as g talks resumed in Victoria, Quebec’s delegate cast cold water on the notion of forward momentum. The federal government, Facal insisted, “still wants to be able to launch unilateral initiatives in areas of exclusive provincial jurisdiction. In no way, shape or form could we legitimize such intervention.” By the time McLellan joined the talks—later than scheduled, on their second day—it was clear that considerable distance still separated Ottawa from the provinces. Brushing past reporters as she strode from the panelled elegance of Victoria’s landmark Empress Hotel into the steel-and-glass atrium of the conference centre on Friday, the justice minister said tersely that she expected “frank and candid discussion and probably some hard bargaining.” By noon on Saturday, McLellan was forced to concede that a deal was not in the works—this time.

For some, there was at least as much reason to step back from a deal as there was to push forward. That was particularly true for Quebec’s sovereigntist government—failure of the social-union talks could afford further proof of federalism’s shortcomings. In Ottawa, meanwhile, Chrétien’s powerful Ontario caucus has resisted turning any additional money over to the provinces without binding commitments on how it will be spent. Ontario Liberal MPs fear Tory Premier Mike Harris would simply use any extra federal money to lower taxes—and make off with the political credit.

The Feb. 16 federal budget, meanwhile, will be closely watched for signs that Ottawa’s ardour for a social-union agreement is cooling. Quebec’s Facal, in particular, warned that any new initiative which steps on provincial toes could undo whatever progress has been made so far. Said Facal: “The budget will be a decisive test of the government’s good faith.” But as negotiators packed up their papers and prepared to leave Victoria on Saturday, they insisted the social-union talks remain on track—just moving more slowly than expected. For most Canadians, if there was little to mourn in the talks’ failure to find common ground, there was nothing to celebrate either. □