Improving decision-making and debate around Canada’s intergovernmental transfer system: The potential of an independent council

Abstract

Intense controversy over Canada’s federal-provincial transfer system has returned. The latest round of conflict highlights a number of problems with the system, including the lack of adequate insurance against provincial revenue shocks. But more than anything, it highlights problems with national decision-making processes and debates. The federal government is free to change most aspects of the system unilaterally, but must – for the sake of national unity and its own electoral interests – take provincial views into account. Many provinces have been all too happy to supply these views, but in predictably self-serving ways that have left the feds (reluctant to raise regional tensions further) more or less silent. It is hard to fault this cautious approach given the various threats to national unity. But it has left the transfer system with a striking lack of vision and reform initiative. What, if anything, can we do to remedy this situation?