Address by the Honourable John F. Hamm, MD, MLA
Premier of Nova Scotia
Nova Scotia Chamber of Commerce
October 24, 2000

Canada in the next decade: A provincial perspective on the nation.

One of the many things I have learned over the past year and one of the toughest questions that I get asked as Premier is what my vision of Canada is and where I think the future of our country lies.

I think everyone here today would choose the same words in response: I want a Canada where fairness, equality, respect, generosity, sharing and tolerance are the dominant principles that guide society and its public institutions.

When it comes down to the basics, these qualities are the glue that solidified our fragile Confederation over 100 years ago and which still bind us together today.

Today I want to go beyond those words and explore how I believe our country should evolve and how Nova Scotia must carve out a new niche.

I accepted this invitation long before "election fever" hit Ottawa, but since then some events have only reinforced my fears over the current state of federalism.

The principles I talked about a moment ago -- the glue which has held us together for so long, through good times and tough times – are at risk of disappearing. And when that happens, the bonds which hold us together as a nation can only weaken.

I say this in a context where there have never been so many positive things happening in our Province. We have an unparalleled opportunity to reposition ourselves on both the national and the international stage.

As one of the founding provinces who played a decisive role in the shaping of the country called Canada and we can and must play as strong a role as our nation evolves in the 21st century.

We are virtually unique among nations: Our nation was formed over a conference table and not on the battlefield.

The vision of the Fathers of Confederation was one of fairness and balance, not one of confrontation. But the process hasn't been entirely painless. Nova Scotia and Nova Scotians have learned some hard lessons over time:

Who ever would have thought that the implementation of a so-called National Policy would have produced such negative effects in this region while Central Canada and later the West prospered and bloomed?

Until some of our recent successes in the knowledge economy and in the Offshore, many believed that the Maritimes might never begin to recover from this blow.

By the time free trade with the US was back on the radar screen in the 1980s, Maritime business and industry had lost the better part of a century's worth of sustained opportunity.

This inequitable situation was worsened in the 1920s when nationally-imposed transportation and tariff policies further hampered our competitiveness relative to Quebec and Ontario. The entrepreneurs who kept our economy going during these years deserve our respect and thanks.

These economic barriers continue on today in subtle ways – like the subsidization of ice breaking fees in the St. Lawrence Seaway. We have two of the world's greatest ice-free parts and yet this subsidy puts them at a competitive disadvantage for much of the year.

There are many more examples, but the lesson is clear: The cycle of depressed economies and out-migration, once started makes it increasingly difficult to sustain the momentum you need to support the expectations and ambitions of your province or region.

This situation persists today and many of our best and brightest are still leaving for opportunities elsewhere... they must be forgiven for sometimes feeling that the "National Dream" a national nightmare.

Unfortunately, today we face potential peril just as serious as those in the past. Words and rhetoric don't change the fact that there exists a long-standing fiscal imbalance that has made this region a less than equal partner in Confederation.

It hampers our ability to thrive and our right to be have province - rather than a have-not. Equality of the provinces is a central underpinning of Confederation, and was reaffirmed in the Constitution Act on 1982.

That concept brought balance to the federation and allowed us to create a Canadian identity rooted in fairness, equality, respect, generosity, sharing and tolerance.

This concept of balance has taken on many names and shapes throughout history. Some know it as fiscal federalism. I prefer to call it "fair federalism".

The federalism of fairness grew from shared legislative powers outlined in the Constitution. In many cases -- and this is a critically important -- compensation arrangements were negotiated to ensure that no matter the condition of a province's economy Canadians would have access to similar services and supports no matter where they live.

I have been talking about Equalization a lot these days, the complex formula which supports the principle of fairness. In 1940 when Canadians were grappling with ways to make sure this principle would become part of our fabric, it was Nova Scotia's Premier Angus L. Macdonald who lead the charge.

Premier MacDonald suggested that the federal government assume responsibility for social services, such as Old Age pensions and employment insurance. He argued that this would allow national standards, and would level the playing field among the provinces in the provision of social services.

In a submission to a federal commission, the Province of Nova Scotia said: "a federation defeats its primary purpose if, through its constitutional arrangements or by policies instituted by the national government, it accomplishes the debilitation of one or more of the political communities of which it is comprised."

Nova Scotia put forward this position over 60 years ago... and it's just as true today!! Even before the services which are now the hallmark of our country had been put in place, a Nova Scotia Premier was raising the important issue of the equal provision of comparable social services for all Canadians no matter where they live.

Even then we foresaw that without support, the imposition of national programs without the capacity to implement them could only divide the country based on economic status. The greatest threat today to federalism is no longer linguistic or cultural, it is the ability to provide our most valuable programs.

That's the source of my concern for the future of Canada and Nova Scotia's place in it. How have we progressed as a province and as a nation?

Lets begin our analysis by looking at our instruments of social policy. The social contract between both levels of government with Canadians over the past fifty years has helped define the character of our country. It exemplifies the best values and qualities of all Canadians.

And yet, lately I am struck by a feeling that we are gradually losing the basic values that have governed federal-provincial relations in the past. I'm concerned that my view of Canada today – a view based on fairness, equality, respect, generosity, sharing and tolerance – is no longer the common Canadian view. The glue is slowly melting.

Two recent experiences really drove this point home: The Annual Premiers' Conference in August resulted in a strong statement supporting the restoration of fiscal balance in Canada. Yet, less than a month later at the First Ministers' Meeting, there was a retreat from this position.

The federal government played a shell-game with the Provinces on health funding. The real inequities and imbalances were not dealt with. Instead there was a short-term political fix based on numbers not people's needs.

What happened at that First Ministers Meeting was precisely what Angus L. MacDonald warned against sixty years ago. The First Ministers showed how the federation endangers itself by pursuing fiscal policies focused on the specific, while remaining oblivious to the big picture. In the process, Canada's constituent parts – the Provinces – were badly hurt.

The failure by First Ministers to address the fiscal imbalance – and to relegate the issue to the Finance Ministers – was a blow to Nova Scotia.

It was a blow because Canada is more than an economic union of disparate provincial interests. Indeed, Nova Scotia's role and place in the future of the federation goes well beyond simple economic advantage. Being a Canadian from the Province of Nova Scotia has to mean more than just being a line on a balance sheet in a federal government ledger.

Equalization is not a bare-handed grab from the "haves" by the "have-nots" – it is the Constitutional embodiment of equality. Equalization is more than just fiscal arrangements. It's a bold statement of and by all Canadians – all Canadians – that we share a common vision, a common destiny, and that being Canadian is about tolerance, generosity and fairness.

That vision brought Canada together – a common vision of a society predicated upon equity – and it must grow stronger in the future if we are to remain one nation. It's the glue that binds us together.

Several weeks ago, I read in the Globe and Mail that the Government of Alberta is going to be consulting the people of that province on how it should spend its budget surpluses once the provincial debt has been eliminated.

While I'm happy for Albertans, I did have a pang of budget-envy. Following that, it occurred to me that as the wealthy provinces are increasingly able to consider questions of this nature, the less-well-off provinces face an ever-widening gap between what they can reasonably provide their citizens compared to our partners in Confederation.

In the absence of a true Equalization program, citizens of this country will be treated neither equally nor fairly depending on where they choose to live.

It is ironic that at a time when we have been celebrating the dawn of the new millennium and the exciting challenges posed by the 21st century, we somehow seem to have lost sight of those traditional Canadian principles like fairness and equity.

But as businesspeople you all know that talk is cheap, it's actions that add up to success. So what are we, and it has to be all of us, going to do about our concerns?

Nova Scotian Canadians don't accept the inequity of current circumstance. I refuse to bargain piecemeal for their future within Confederation.

That would certainly be the easier road, but not the right road to take.

We must be strategic when the opportunity presents itself and press for a fairer and more equitable solution. There will never be a better time than now to let Ottawa know that Nova Scotians will fight for fair federalism if they won't.

Nova Scotia stands today on the verge of success. We are developing our offshore resources. Our economy is diversifying in areas like technology, environmental industries, tourism, biotechnology, and transportation.

Each year we are becoming less and less dependent upon traditional resource-based sectors for economic growth. Certainly, resource industries have a tremendous role to play in our future as a province but my point is they're no longer the only game in town.

For the first time in a century, Nova Scotia can clearly visualize a time when the term "have-not" is no longer in our social, economic and political vocabulary.

As your Premier, its my job to see that Nova Scotians receive the lion's share of the benefits from our offshore resources.

To do that, I need to make sure that our province gets the fair and equitable treatment it deserves. So whether its on the Equalization issue, or offshore gas royalties, I am committed to using every mechanism at my disposal to get a better deal for Nova Scotia.

I want to fight for a fair Equalization and transfer program from Ottawa because the current system does not address our needs.

In health care, for example, our costs are higher on a per capita basis than most other provinces but this reality is not reflected in a mechanism like the CHST that's based on a head count.

Our greatest challenge within the Canadian federation is convincing Ottawa and the other provinces that Nova Scotia will not be content with survival on the fringes. I ask only for what is rightly ours.

To that end, I offer you my vision of Nova Scotia's future in Confederation. First, as Nova Scotians, we must recapture the sense of struggle, survival and perseverance that was a part of daily existence for our forebears. That means independent and innovative thinking; it means being responsive to changing circumstances; and it means being adaptive to our environment in Canada and in the world. Nova Scotians are up to meeting these challenges.

Second, our Province must champion stronger regional cooperation in Atlantic Canada. We can and must set an example for the rest of the nation here. We should take a united regional bargaining approach to national issues.

We should build stronger alliances on common issues. We must resist the temptation to self-interest by being wooed by federal largesse when it divides us on key issues, like equity and fiscal imbalance.

Furthermore, as a province we need to promote and build stronger alliances with other provinces across Canada who share our ideas as well as our circumstances.

Third, and finally, if we are to rebuild an equally sustaining and sustainable social contract between governments and Canadians, we must achieve two goals: Rediscover, as a nation, the collective values and ideals upon which we were founded... And rethink the instruments of federalism within that context. We need to return to true equalization. Let's prescribe a new formula that brings services in line with a realistic percentage of the national norm. Let's move to a fair, equitable and balanced equalization program that is based on actual needs instead of population.

This is a debate about fair federalism. And now is the time to have to have it and to listen very closely to what other have to say about it -- and the time to pass judgement on their words. Let's have a debate about values and principles, for it is our values and principles that shape how we live our lives and conduct our affairs.

Tonight I want to ask each of you here... indeed, all Nova Scotians ... to do themselves and the Province a favour: During this federal election I implore each of you to ask every candidate seeking election – no matter what their political stripe – about their position on the question of Equalization.

Ask them if it's right that Ottawa will take seventy cents of each dollar we earn in off-shore royalties, while Nova Scotians get thirty cents. Ask them what is fair about that, and if it is not fair what they intend to do about it.

This will be a critical issue for Nova Scotia in the coming years, and each Canadian citizen from Nova Scotia needs assurance that their Member of Parliament in Ottawa will be representing their best interests.

If, as a people, our common vision speaks to equity... and we believe in fairness and generosity... and we believe in tolerance and respect... then each of those qualities will be reflected in how we govern ourselves, and in our society as we go forward.

Thank you.