Between a Rock and a Hard Place: The Report of the Newfoundland and Labrador Commission on Our Place

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Between a Rock and a Hard PlaceThe Report of
the Newfoundland and Labrador Commission on Our
Place in Canada

• Douglas Brown

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Our Place in Canada

• Royal Commission Mandate
• Process
• Framing of the Issues
• Conclusions and Recommendations
• Post-Commission developments

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Royal Commission Mandate

• Returning to 1949 what were the expectations on
  joining Canada?
• Comprehensive examine all aspects of NL
  relations with Canada
• Forward-looking how to renew and strengthen our
  place in Canada
• Open-ended how to increase prosperity and
  self-reliance

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Commission Proces

• Appointed May 2002 reported July 2003
• Three Commissioners Vic Young, Elizabeth Davis
  and James Igloliorte
• Small staff
• 25 public meetings, dozens of private ones
• Research program of 30 studies
• 15 months, budget of 2.3 million

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Why a Commission

• General malaise due to long-term effects of 1992
  cod moratorium, outmigration and federal budget
  cuts of 1995
• Specific political rationale to give Grimes
  government a boost, find new ideas for
  intergovernmental strategy
• Political risks creating a monster of raised
  expectations, no new solutions, too big a
  mandate, not enough time

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Framing the Issues

• Trying not to blame Canada
• Facing hard truths
• Embracing a sense of place
• Seeking a new way of relating
• Devising an integrated strategy

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Hard truths

• Economic disparitystill in last place
• Fiscal crisisagain
• Fisheries teetering on the brink
• Rural communities in sharp decline
• Severe out-migration
• Weak constitutional position

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Key conclusions and recommendations

• No to separation, no to the status quo
• Need for collaborative federalism
• To be the principal beneficiary of offshore oil
  revenues
• Concerted effort to restore the fisheries
• A new partnership for hydro development
• Putting the fiscal house in order
• Facing up to rural sustainability

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No to separation

• Proud to be Canadian
• Only 12 percent want independence
• Huge level of dissatisfaction with how Canada
  works
• Terms of Union cannot be amended

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Collaborative Federalism

• Need collaborative, not competitive federalism
• Respect for NL as a province
• More federal presence
• More flexibility and accommodation to unique
  needs
• Senate Reform
• Council of the Federation

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Offshore Oil

• Atlantic Accord, negotiated by Mulroney-Peckford
  in 1985 NL was to be the principal beneficiary
  in fiscal terms
• Initial fiscal projections of Accord unrealistic
• Government of Canada reaps 75 to 80 percent of
  total revenues
• Got to revisit the deal

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Last Chance for the Fishery

• Too much fed-prov squabbling
• Need an action plan to address stock rebuilding,
  prevent foreign over-fishing, have joint
  management of licensing

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Churchill River Hydro

• Churchill Falls contract of 1969 with Hydro
  Quebec still costs NL an estimated 800 million a
  year in lost profits
• But forget about linking new Lower Churchill
  project with renegotiated deal
• Instead get other partners (e.g. Feds, Ontario)
  to promote an equitable new development

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Provincial Fiscal Reform

• Unsustainable fiscal deficit
• Offshore oil revenues not going to close the gap
• Need to balance the budget, engage in program
  review (i.e. cant do it all) and address pension
  liabilities

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Rural Sustainability

• Survival of rural Newfoundland is at stake
• No one wants to discuss the issue
• Commission failed to get consensus
• Need for a sustained public dialogue or
  deliberation
• There is a cross-Canada search for solutions

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Impact of Commission

• NL is here to stay in Canada
• Confident sense of place something to build on
• Greater sense of realism
• Portrays gaps in cohesion as a community
• Some blamed report as not bold enough
• Provided a good foundation for a fresh approach

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Developments since 20031

• Williams government gets elected November 2003,
  program very similar to Commission report
• Premiers agree to a new Council of Federation,
  December 2003
• Paul Martin and Stephen Harper both promise a new
  deal on the offshore Martin government
  delivers, Feb. 2005

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Since 2003

• Budgetary position of province much improved
• Oil-driven economy pushes NL into 6th or 7th
  place nationally
• Rural out-migration continues
• Williams takes aggressive line with feds over
  equalization, fishery and with business over oil,
  hydro and mines