Divided Sovereignty in Canada

The Realm of Divided Sovereignty

• In 1867, the Constitution Act divided power between the House of Ottawa and the Provinces.
• Ottawa controlled trade and defence.
• The Provinces controlled health, education and property.
• This agreement was known as Divided Sovereignty.
• Legislative federalism created "watertight compartments" of power.
• New forces like climate change, cybercrime, global trade, Indigenous resurgence, and cultural nationalism challenged the old compartments.
• Cooperative federalism emerged, allowing the Houses to share duties, negotiate deals, and co-design policy.
• Child care programs became subject to bilateral funding agreements.
• Climate action required national frameworks with provincial buy-in.
• Indigenous rights demanded shared governance and reconciliation.
• The sacred pact became adaptive, shifting with the times while respecting divided power.

The Judges and the Scrolls

• The Supreme Court of Canada acts as the Supreme Council and guardian of the Constitution.
• The Anti-Inflation Reference (1976) stated the federal government could use its POGG powers to control inflation, even in provincial matters during economic crises.
• Crown Zellerbach (1988) invoked the National Concern Doctrine, allowing Ottawa to regulate matters of national importance like ocean dumping.
• The Quebec Secession Reference (1998) declared unilateral secession impermissible and laid out the principles of federalism, democracy, the rule of law, and respect for minorities.
• The Greenhouse Gas Pricing Reference (2021) upheld Ottawa's carbon pricing regime, ruling greenhouse gases a national threat.
• The Constitution is a living tree, growing with society and grounded in its roots.

The Many Eras of Peace and Strife

• Intergovernmental relations have evolved through various eras.

Classical Federalism (1867–1930s)

• Each House ruled alone.
• Disputes were rare.
• Ottawa was dominant.
• Ambiguity existed in the Constitution regarding natural resources and taxation.

Post-War Federalism (1940s–1960s)

• Ottawa expanded welfare programs with provincial cooperation.
• The Canada Pension Plan (CPP) was created.

The Quiet Revolution & Constitutional Battles (1960s–1980s)

• Quebec demanded autonomy.
• Western provinces resisted federal control of energy.
• Constitutional reform failed repeatedly.
• The 1982 Constitution Act included the Charter, but Quebec refused to sign it.

The Era of Agreements (1990s–2000s)

• Followed the failure of the Meech Lake (1987) and Charlottetown Accords (1992).
• Governments turned to practical collaboration.
• The Social Union Framework Agreement (SUFA) created a platform for provinces to shape national policy.

Contingent Federalism (2006–present)

• Relations now depend on the personalities of rulers.

• Some prefer provincial autonomy.

• Others prefer coordinated agreements.

• Intergovernmental relations have become more complex and flexible.

• Through each era, the Realm has struggled to balance unity and diversity.

The Flow of the Kingdom’s Gold

• Fiscal federalism involves wealth flowing from Ottawa to the provinces
• Equalization was created in 1957 and entrenched in the 1982 Constitution.
• It gives unconditional gold to provinces with low revenues to offer comparable services.
• The Canada Health Transfer (CHT) provides conditional funds for healthcare.
• It is tied to the Canada Health Act which ensures healthcare is public, universal, portable, accessible, and comprehensive.
• The Canada Social Transfer (CST) supports education, social programs, and child care.
• The Fiscal Stabilization Program provides emergency funds for provinces facing severe revenue decline.
• The Territorial Funding Formula (TFF) is tailored to the North’s unique needs.
• Indigenous Transfers support self-governance, healthcare, education, and infrastructure.
• Employment Insurance (EI) is administered federally and paid through payroll deductions.
• Transfers shifted from cost-sharing to block funding, granting provinces more autonomy but exposing them to budget pressures.

The Power of the Purse

• The federal spending power allows Ottawa to reach beyond its constitutional borders by offering funds to provinces.
• Provinces must agree to terms to receive the funds.
• Hospital Insurance (1957) spread from Saskatchewan to all provinces.
• Physician Services (1962) became available.
• The Canada Assistance Plan required basic standards for social support.
• The Canada Health Act (1984) set national healthcare rules in exchange for funding.
• In the 1990s, Ottawa combined transfers into the Canada Health and Social Transfer (CHST)and reduced funding.
• Bilateral child care deals were funded under Trudeau.
• The power has supported targeted mental health and housing initiatives, and conditional support for environmental action.

The Scrolls of Change

• There are five ways to amend the Constitution of the Realm

The 7/50 Rule

• Requires the House of Commons and Senate plus seven provinces representing 50% of the population.

The Unanimity Rule

• Requires every province and both federal chambers to agree.
• Applicable for changes to the monarchy, official languages, or the Supreme Court.

The Bilateral Rule

• Used when only one province is affected.
• Newfoundland amended its religious school rights with Ottawa’s approval in 1997.

The Federal-Only Rule

• Allows Ottawa to act alone if the amendment only concerns federal institutions.

The Provincial-Only Rule

• Allows provinces to amend their own constitutions regarding the size of their legislatures or structures of their courts.
• The Meech Lake Accord (1987) failed when Manitoba and Newfoundland refused to ratify.
• The Charlottetown Accord (1992) was rejected by national referendum.

The Builders of Welfare

• Social programs were forged to meet the needs of the people.

Classical Federalism

• Ottawa and the provinces acted independently.
• Ottawa created Unemployment Insurance (UI), Old Age Security (OAS), and Family Allowances.
• Provinces managed Workers’ Compensation, education, and welfare.

Shared-Cost Federalism

• Ottawa offered gold in exchange for cooperation after World War II.
• Hospital Insurance (1957) and Physician Services (1962) were funded jointly.
• The Canada Assistance Plan (1966) required open and accessible welfare programs.
• Ottawa covered half the cost.

Joint-Decision Federalism

• Ottawa and the provinces created the Canada Pension Plan (CPP) in the 1960s.
• Quebec opted out, creating the Quebec Pension Plan (QPP).
• Any changes to CPP required the approval of 7 provinces with 2/3 of the population.
• Austerity cut UI and welfare in the 1990s.
• Trudeau’s government launched the Canada Child Benefit (CCB) in 2016.

The Green Reckoning

• Provinces such as Saskatchewan and BC took the lead by forging early environmental laws.
• Ottawa created the Canadian Environmental Protection Act (CEPA) in the 1970s and signed international treaties, but provinces pushed back, mainly on resource development.
• Ottawa launched the Pan-Canadian Framework (2016), offering funding for carbon reduction.
• Provinces like Ontario and Alberta rejected it, fearing economic harm.
• Ottawa enacted the Greenhouse Gas Pollution Pricing Act in 2018, imposing a carbon tax on provinces that didn't implement their own plan.
• The Supreme Court ruled in 2021 that climate change was a national concern, allowing Ottawa’s law to stand.

Courtroom Storms and Environmental Thrones

• Ottawa passed the Greenhouse Gas Pollution Pricing Act (2018), requiring provinces to tax carbon or face a federal tax.
• Alberta and Saskatchewan resisted.
• The Supreme Council invoked the National Concern Doctrine in 2021, ruling that climate change was indivisible and the carbon tax stood.
• The Crown Zellerbach (1988) case allowed Ottawa to regulate marine pollution.
• Frameworks like the Pan-Canadian Climate Plan worked when provinces agreed.

The Environmental Maze

• Jurisdictional overlap exists where Ottawa can legislate on fisheries, treaties, criminal law, and interprovincial trade, while provinces control natural resources and land use.
• Economic differences split the Realm.
• Public opinion wavered.
• Indigenous rights added complexity and justice.

The Social Shapeshifters

• Social programs were not fixed and have adapted to ideologies and economic tides.
• Mid-century Liberals expanded welfare.
• Harper’s Conservatives (2006–2015) shifted social policy to targeted benefits like the Universal Child Care Benefit (UCCB).
• The Trudeau era saw a shift back with the Canada Child Benefit (CCB), replacing earlier programs with tax-free monthly payments.
• Crises like COVID-19 brought new support in the form of the Canada Emergency Response Benefit (CERB) and expanded EI.

The Federalism Mirror

Classical Federalism

• Provinces and Ottawa worked in silos.
• UI was federal.
• Social assistance was provincial.

Shared-Cost Federalism

• Ottawa offered gold, and provinces delivered services.
• Together, they built hospital insurance, Medicare, and the Canada Assistance Plan, but Ottawa set conditions.

Joint-Decision Federalism

• Programs like CPP/QPP required formal approval from most provinces and couldn't be changed unilaterally.
• Classical offered clarity, but lacked cooperation.
• Shared-cost enabled national standards but made provinces dependent.
• Joint-decision brought stability but required patience and diplomacy.
• Modern social policy blends all three models.