Redistributive federalism: Redistributing wealth and income in the Canadian federation

摘要

The Government of Canada has been engaged in a massive redistribution of wealth and income from some provinces – usually British Columbia, Alberta and Ontario – to the other provinces and territories. This redistribution has been accomplished through a number of federal government programs that may have been presented to the public as having nation-wide applicability and not necessarily designed to meet the needs of any particular province or territory. These federal programs are part of a coherent redistributive whole, but each demonstrates how redistribution has been accomplished. They include transfer programs, such as Equalization and Territorial Formula Financing, that have explicitly addressed the horizontal fiscal imbalance. They also include transfer programs like the Canada Health Transfer, the Canada Social Transfer, labour market training and development, and infrastructure that have implicitly moved federal fiscal resources to various regions of the country. And they include direct federal spending programs like Employment Insurance, immigrant settlement and regional economic development. The extent of this redistribution is discussed, as are the reasons for this redistributive focus and the impact of such large-scale federal transfers on provincial budgets. Finally, an assessment is made of why the degree of redistribution appears to have been reduced in recent years.