Québec Portal Version française To contact us Return to Home page

The commission
Mandate
Members
Documents
Commission publications
References
bibliography
Public hearings
Presentation of briefs
Briefs received
International Symposium on Fiscal Imbalance
 
 
  Documents

Fiscal imbalance in Canada
Historical context

Report - Supporting document 1

The Table of contents and the Introduction are presented here. The entire document is only available in PDF format (652 ko).

Table of Contents

TABLES AND DIAGRAMS
CHARTS
INTRODUCTION

CHAPTER 1 - THE BRITISH NORTH AMERICA ACT
ORIGINS OF THE BRITISH NORTH AMERICA ACT
The choice of a federative model
The adoption by the provinces of the agreement
THE DIVISION OF POWERS UNDER THE FEDERAL UNION
Division of powers
Division of fields of taxation
Definition of direct taxing power
Effect on the financial self-sufficiency of the provinces

CHAPTER 2 - THE FEDERATION'S FIRST STEPS (1867-1940)
POLITICAL AUTONOMY OF THE PROVINCES
Power of disallowance
Declaratory power
FINANCIAL SELF-SUFFICIENCY OF THE PROVINCES
Statutory subsidies
Direct taxes
Conditional subsidies
The Great Depression
THE ROWELL-SIROIS COMMISSION

CHAPTER 3 - THE EMERGENCE OF THE WELFARE STATE (1941-1970)
THE DIVISION OF TAX FIELDS
Tax rental agreements
The 1942 agreement
Subsequent tax rental agreements
The Tremblay Commission
Tax collection agreements
1957-1962 agreement
The 1962-1967 and 1967-1971 agreements
GROWTH OF THE WELFARE STATE
Provincial initiatives
Shared-cost programs
Direct federal public services
Right of withdrawal with full financial compensation

CHAPTER 4 - THE REDEFINITION OF THE WELFARE STATE (1971-1995)
THE GOLDEN AGE OF THE WELFARE STATE
Exploitation of liberalized tax room
Development of the Welfare State
WITHDRAWAL OF FEDERAL FINANCING
A gradual withdrawal
The consolidation of transfer programs
Block funding
Reduction of the amounts transferred to the provinces
Strategic control over the use of the funds transferred

CHAPTER 5 - FISCAL IMBALANCE FRONT AND CENTRE
FEDERAL REINVESTMENT
THE SOCIAL UNION
Québec's rejection of the agreement
Accountability
FEDERAL PROGRAM SPENDING

CONCLUSION
APPENDIX 1 - GLOSSARY
APPENDIX 2 - BIBLIOGRAPHY
MAIN REFERENCES
OTHER REFERENCES

TABLES AND DIAGRAMS
TABLE 1A - Division of Powers Stipulated by the Constitution Act, 1867 and Subsequent Amendments
TABLE 1B - Division of Powers Stipulated by the Constitution Act, 1867 and Subsequent Amendments (continued)
TABLE 1C - Division of Powers Stipulated by the Constitution Act, 1867 and Subsequent Amendments (continued)
TABLE 1D - Division of Powers Stipulated by the Constitution Act, 1867 and Subsequent Amendments (continued)
TABLE 2 - Revenues of the Provinces prior to the British North America Act
TABLE 3 - Main Conditional Subsidy Programs - 1912-1930
TABLE 4 - Compensation Stipulated in the 1942 Agreement
TABLE 5 - Major Components of the 1957-1961 Agreement
TABLE 6 - Abatements Allowed to the Provinces - 1947-1971
TABLE 7 - Major Federal Conditional Transfer and Shared-cost Programs - 1940-1968
TABLE 8 - History of the Special Québec Abatement - 1964-2001
TABLE 9 - Change in Québec's Share of the CHST in Cash - 1994-1995 to 2001-2002
TABLE 10 - Major Federal Programs Affecting Fields of Provincial Jurisdiction - 1997-1999

DIAGRAM 1 - Post-war Fiscal Agreements
DIAGRAM 2 - Process of consolidating federal conditional transfer
programs - 1950-1995

CHARTS

CHART 1 - Breakdown of Provincial Revenues - 1874 and 1896
CHART 2 - Federal Transfer Payments to the Provinces - 1912-1941
CHART 3 - Unemployment Rate in Canada - 1921-1941
CHART 4 - Public Expenditures and Deficits - 1926-1939
CHART 5 - Federal Government Military Spending - 1909-1975
CHART 6 - Distribution of Tax Fields - 1937, 1941 and 1943
CHART 7 - Average Annual Population Growth - 1861-1871 to 1996-2001
CHART 8 - Average Annual Growth Rate of the City of Montréal and Its Suburbs - 1941-1951 and 1951-1961
CHART 9 - Federal Transfer Payments to the Provinces - 1935-1965
CHART 10 - Change in Financial Transfers to the Provinces - 1950-1979
CHART 11 - Provinces' Own-sources Revenues and Federal Revenues - 1962-1996
CHART 12 - Change in the Proportion of Personal Income Monopolized by Federal and Provincial Income Tax (Including Social Contributions) - 1962-1995
CHART 13 - Annual Growth in Real GDP - 1950-1999
CHART 14 - Federal and Provincial Budget Balances - 1962-1996
CHART 15 - Change in the CHST in Cash in Relation to Provincial Spending on Health, Education and Social Services - 1982-1983 to 1998-1999
CHART 16 - Change in Federal Government Transfers as a Proportion of the Total Revenues of the Provinces and Territories - 1980-1981 to 1998-1999
CHART 17 - CHST Cash Transfer (including trust accounts) Compared to Provincial Spending on Health, Education and Social Services - 1982-1983 to 2005-2006

INTRODUCTION
Fiscal imbalance between the federal government and the provinces has been the subject of intense discussions for several years. The expression "fiscal imbalance" is used to describe a situation in which, in light of effective occupation of tax fields, Québec and the other provinces have insufficient revenues to exercise their fields of jurisdiction while, to the contrary, the federal government has revenues in excess of what is necessary to fund its fields of jurisdiction. Such imbalance raises basic questions in respect of public finances and the very role of the federal and provincial governments.

This document examines the key events that have marked relations between Ottawa and the provinces since 1867. In so doing, it highlights the historic foundations of the fiscal imbalance prevailing in Canada.




Home | Québec Portal | To Contact us | Français
The Commission | Documents | Public hearings | Briefs received| Symposium


© Gouvernement du Québec, 2002