Federal-Provincial Fiscal Arrangements: Thinking Outside The Box

Federal transfers are an important element in preserving the Canadian union. Fundamental structural changes in the global (hence the Canadian) economy will make it increasingly difficult to ensure the equality of public services — a principle enshrined in the Constitution Act, 1982 — without damaging the economy and threatening national unity. A more productive and achievable objective would be to provide essential public services of reasonable quality to all Canadians through federal investments that will create more provincial own-source income, support the development of competitive manufacturing and services industries, and build the fiscal capacity of lower-income provinces in general and of populous Ontario in particular. Written by David Dodge, Peter Burn, and Richard Dion and published in Policy Options magazine, August 2012, Vol 33, No. 7.