ROYAL COMMISSION
ON RENEWING AND
STRENGTHENING
OUR PLACE IN CANADA
Summary of Findings,
Conclusions and
Recommendations
COMMISSION’S MANDATE
Undertake a critical analysis of our
strengths and weaknesses
Make recommendations as to how
best achieve prosperity and selfreliance
TO RENEW AND STRENGTHEN
OUR PLACE IN CANADA
COMMISSION MANDATE
TO RENEW AND STRENGTHEN OUR PLACE IN CANADA
Expectations since 1949
How the province is viewed in Canada
Effects of the Terms of Union
Contributions of Newfoundland and Labrador to Canada
Arrangements with Canada that hamper us
Demographic changes and impact
Strategic location – how to take advantage
TO RENEW AND STRENGTHEN
OUR PLACE IN CANADA
COMMISSION’S
REQUIRED PROCESSES
A research phase
A roundtable consultation phase
A formal public consultation phase
Consideration of Conference
Submission of report on or before
June 30, 2003
TO RENEW AND STRENGTHEN
OUR PLACE IN CANADA
“Without a doubt, I believe the next five to
ten years will be a watershed for the
province in all aspects of society. Analyzing
our role within Confederation will serve as
the genesis of a greater plan towards
greater prosperity.”
Excerpt from the Public Consultations
DELIBERATIONS
Met 1400 people in 25 public meetings
Held school visits, women’s meetings, business visits
Held 8 roundtables
Held 3 dialogues
Received 250 written submissions
Produced 28 research papers
Conducted 2 polls (national, provincial)
EXTENSIVE CONSULTATIONS
SIX PRINCIPLES EMERGED
Passion for this place
New way of thinking
New kind of relating
Belief in ourselves
Time for action
Determined hope for the future
It’s Time To Get On With It
NEWFOUNDLAND
AND LABRADOR’S
CONTRIBUTIONS TO CANADA
Diversity of Aboriginal and non-Aboriginal Cultures
Openness and warmth of people
Skills of a talented workforce
Strategic position and geographic location
World-renowned fishery
Powerful hydroelectric resources
Significant oil and gas reserves
MAGNIFICENT CONTRIBUTION
The assets [of Newfoundland and Labrador], or at least their
relevance, may change over time, but at the moment they
consist of very significant natural resources, some of which
are available in only one or two other parts of Canada; a
rapidly growing reputation as a centre of artistic, cultural
and intellectual creativity; a geographical location which
briefly had military importance, continues to be important in
terms of the country’s vision of itself; and might become
interesting economically; and a collective place for
Newfoundlanders in the Canadian national consciousness which,
while impossible to quantify, is a major asset in itself ...
“Let’s not fall into the trap that some misguided souls
may have by asking what have we done for Canada - the
evidence is under our feet and in the Atlantic blue sky
and on the broad ocean, and in the war graves of Europe
and our proven generosity toward all, and in the
skyscrapers of Ontario and Alberta and in the B.C.
industries, and in the mainland universities and our music
and stories.”
Excerpt from the Public Consultations
CANADA’S CONTRIBUTIONS TO
NEWFOUNDLAND AND LABRADOR
Equal province with nine others
Improvements in overall health of population
Increased education levels
Higher real personal incomes
Improved roads, schools, hospitals
Medicare, Canada Pension, Equalization
Significant development expenditures
MAGNIFICENT CONTRIBUTION TO
NEWFOUNDLAND AND LABRADOR
THE BALANCE SHEET
• Financial benefits from and to federal government
• Do we include
– Lost benefits from barriers and policy failures (e.g.
national energy policy)
– Locational benefits NL brings to Canada
– Future benefits from offshore oil
– Lost benefits from Churchill Falls ($850 million per year)
– Benefits generated by Newfoundlanders and
Labradorians elsewhere in Canada
BALANCE SHEET EXERCISE
UNPRODUCTIVE
POWERFUL SET OF
CIRCUMSTANCE
Fishery all but disappeared under federal control
Hydro developed for benefit of Quebec
Double digit unemployment for last 35 years
12 per cent of population lost to out-migration
Oil revenues – Canada as principal beneficiary
Highest per capita debt
Lowest per capita income
EXPECTATIONS HAVE NOT BEEN MET
Net Migration
1951-52 to 2001-02
Persons
2000
1000
0
-1000
-2000
-3000
-4000
-5000
-6000
-7000
-8000
-9000
-10000
1951-52
1956-57
1961-62
1966-67
1971-72
Source: Economics and Statistics Branch, Department of Finance.
1976-77
1981-82
1986-87
1991-92
1996-97
2001-02
Percent Change in Population
1991 to 2001
Canada and Provinces
25%
20%
15%
Percentage
10%
5%
% Change
0%
-5%
-10%
BC
AB
SK
B
M
ON
QC
NB
NS
PE
NL
Ca
na
da
-15%
Source: Statistics Canada, Demography Division; Economics and Statistics Branch, Department of Finance.
Unemployment
Rates
%
25
20
15
10
5
NL
Canada
0
1966
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
Source: Statistics Canada; Economics and Statistics Branch, Department of Finance.
Note: Due to a change in methodology, rates for 1966 to 1975 are not directly comparable to those of later years.
2002
Newfoundland and Labrador’s Personal Income Per Capita
as a Per Cent of Canada’s Personal Income Per Capita
120%
100%
80%
60%
40%
20%
NL
Canada
0%
1950
1954
1958
1962
1966
1970
1974
1978
Source: Statistics Canada; Economics and Statistics Branch, Department of Finance.
1982
1986
1990
1994
1998
2002
Combined Provincial Debt Obligations Per Capita
Estimated as of March 31, 2003
20,000
19,500
Unfunded Pension Liability
Taxpayer Supported Debt
17,500
15,000
$ per capita
12,500
10,000
7,500
5,000
2,500
B
A
BC
B
N
PE
N
O
B
M
SK
S
N
C
Q
N
L
0
Source: Data extracted from The Canadian Federal and Provincial Governments – 2002 Overview, prepared by the Dominion Bond
Rating Service Limited, January 2003. Comparative data is based on projections in the respective 2002 budgets.
NO TO SEPARATION!
NO TO STATUS QUO!
Newfoundlanders and Labradorians proud to be
Canadians
Poll indicates only 12% support separation
Overwhelming sentiment in favour of improving place in
Canada
Status quo and cycle of dependency totally
unacceptable
Change in Terms of Union not the answer
TIME TO PURSUE A NEW PARTNERSHIP
CURRENT RELATIONSHIP WITH
FEDERAL GOVERNMENT
Blame and acrimony
Confrontation and dismissal
Legal threats, constitutional demands
Lack of understanding and sensitivity
Failure to address major issues together
CURRENT RELATIONSHIP IN DISARRAY
“I believe that Newfoundland and Labrador is
at a crossroad in its history, and it is at this
point that our government and its people must
endorse a new approach in our relations with
the federal government.”
Excerpt from the Public Consultations
NEED FOR A NEW
PARTNERSHIP
Competitive, dismissive federalism not working
Collaboration and cooperation badly needed
Respect, fairness, understanding required
Firm enough to withstand major crises
Flexible enough to accommodate circumstances
Creative enough to find solutions
FEDERATION MUST BE CAPABLE OF CHANGE
SOME CALLS FOR STRIDENT
AND MILITANT APPROACH
UNREALISTIC TO EXPECT
MILITANCY AND PROGRESS
TOGETHER
ENVIRONMENT CONDUCIVE
FOR CHANGE
Canada always a work in progress
1982 = Constitution patriated
1985 = Atlantic Accord signed
1999 = Nunavut newest territory
2003 = newly elected governments likely in 5 to 6
provinces
2003 = newly mandated government NL
2004 = new Prime Minister
NEW RELATIONSHIP IS RISK WORTH TAKING
NEW PARTNERSHIP IN CONTEXT
Commitment to respect and accommodation
Future strength of Canada depends on collaboration
Test case in breaking pattern of confrontation
More organized and better supported First Ministers’
meetings
Federal public service and diversity
Support calls for Triple E Senate
NEW PARTNERSHIP – TWO-WAY STREET
MEASURE OF NEW
PARTNERSHIP
NOT: simply getting along
BUT: extent to which the two
governments jointly deal with key
issues facing the province in the long
term best interests of the people of
Newfoundland and Labrador
“Getting rid of the “poor cousin” myth must
start at home. It must start with a new
mindset and vision for our future that is
not simply held by government, but by all
of us Newfoundlanders and Labradorians.”
Excerpt from the Public Consultations
COMMISSION
RECOMMENDATION
PATHWAY TO RENEWAL
founded on
NEW PARTNERSHIP
&
NEW WAY OF THINKING
NEW WAY OF RELATING
NEW WAYS OF THINKING
AND RELATING
“NEW” does not equal criticism or blame
“NEW” equals different or improved
Context is the opportunity to do better
Objective is renewal
Present-minded in analyzing and
future-minded in tackling issues
IT’S ALL ABOUT “WE”
NEW WAY OF THINKING
AND RELATING
Social inclusion for all
Women’s values, experiences, knowledge and
skills better reflected
Clarity for rights and entitlements of
Aboriginal peoples
Meaningful consultation, inclusion for
Labradorians
PEOPLE OF PROVINCE MUST PULL TOGETHER
YOUTH AND THE FUTURE
Challenge: youth have freedom to stay/go
Awareness of employment opportunities
Education to match opportunities
Student debt = out-migration
Optimism and energy of young men and
women embodies new way of thinking
OPTIMISM OF YOUTH KEY TO RENEWAL
FISCAL HOUSE IN ORDER
NL’s budgetary deficit trend unsustainable
Fiscal options difficult but must be addressed
Offshore oil revenues cannot eradicate problem
Balanced budget legislation
Pension liabilities addressed
Debt/tax burdens then next step
GOVERNMENT MUST COMMIT
TO FISCAL PRUDENCE
FISCAL FEDERALISM
Equalization changes = 10 province standard,
accommodation for population change
Preservation of generic solution
Increased CHST funding, accommodation for
population change
New cost-shared agreements
FEDERAL FISCAL TRANSFERS REMAIN CRUCIAL
LAST CHANCE
FOR THE FISHERY
Collaborative approach needed
Action Team = focus on fish
Negotiation of joint management
Address foreign over-fishing
COLLABORATIVE APPROACH CRUCIAL
ACTION TEAM
Consensus exists on what is needed to rebuild stocks
Action Team jointly appointed by Premier and Prime
Minister
Timeframe for Action Plan report = six months
Threefold mandate:
rebuilding groundfish
sustaining shellfish
restoring science
COLLABORATIVE APPROACH CRUCIAL
TO REBUILDING STOCKS
JOINT MANAGEMENT
Inconceivable province has no say in its own fishery
Collaborative vision needed even with split jurisdiction
Negotiation of joint management
Three principles
•
Joint setting of TAC’s and allocations, and regulation of
harvesting & processing sectors
[Accommodation possible for setting of TAC’s]
2. Mechanisms open, stakeholder input
3. Licensing by arms-length body jointly appointed
COLLABORATIVE APPROACH CRUCIAL
TO MANAGING OUR FISHERY
FOREIGN OVER-FISHING AND
STRADDLING STOCKS
Pursuit of management/conservation plan
to address over-fishing
More forceful action within and
strengthening of NAFO
At same time, prepare international
community for possible unilateral action
such as custodial management
COLLABORATIVE APPROACH CRUCIAL
TO CONTROL OF OVER-FISHING
RURAL SUSTAINABILITY
Significant social/economic challenge = survival
of rural NL
Major issue all over the world
Difficult issue even to discuss in this province
Failure to discuss prevents creative solution
OVERWHELMING LACK OF ANSWERS
TO RURAL QUESTION
RURAL SUSTAINABILITY
Need for informed, public dialogue
Dialogue preparation for rural
strategy
Provincial government the leader
Federal government involved
OVERWHELMING LACK OF ANSWERS
TO RURAL QUESTION
REGULATION
OF NATURAL RESOURCES
Pursuit of best possible returns from natural
resources
Current review of electricity policy valuable
opportunity
Consideration of powers under Constitution
including 92A to derive benefits from
electricity on Island and in Labrador
SECTION 92A NEEDS
CAREFUL CONSIDERATION
“Clearly Newfoundland [and Labrador] is not the
primary or principal beneficiary of the offshore
resources, nor of offshore revenues, but a minor
beneficiary
when
compared
to
the
federal
government. The importance of this is that, unless
the Atlantic Accord is honoured and implemented as
to its original intent, Newfoundland [and Labrador] is
unlikely ever to become a self-sufficient province
within the Canadian federation.”
John Crosbie, Research Paper for the Commission
OFFSHORE OIL –
PRINCIPAL BENEFICIARY
Stated intent of Atlantic Accord = NL
principal beneficiary
Projections in Accord based on overoptimistic assumptions
Result = principal beneficiary is
Government of Canada (75 – 80% of
revenues)
SPIRIT AND INTENT OF ACCORD
MUST BE HONOURED
OFFSHORE OIL –
PRINCIPAL BENEFICIARY
Intent and spirit of Accord not being met
Greater share of revenues must go to NL
Accord must be revised to ensure intent met
NL to receive higher share until it reaches
Canadian average on specific social/economic
measures
SPIRIT AND INTENT OF ACCORD
MUST BE HONOURED
Total Government Revenues from Offshore Oil
Combined Federal/Provincial Revenues
1200
millions of dollars*
1000
800
600
400
200
0
23
22
21
20
19
18
17
16
15
14
13
12
11
10
09
08
07
06
05
04
Fiscal Year
Source: Projections based on the existing projects (Hibernia, Terra Nova and White Rose). Data extracted from projections provided by the
provincial Department of Finance.
*Note: Constant dollars adjusted for inflation.
Government Revenue Sources from Offshore Oil
Federal/Provincial Revenues
1200
Federal Corporate Income Tax
Revenues
millions of dollars*
1000
Provincial Corporate Income
Tax and Royalties
800
600
400
200
23
22
21
20
19
18
17
16
15
14
13
12
11
10
09
08
07
06
05
04
0
Fiscal Year
Source: Projections based on the existing projects (Hibernia, Terra Nova and White Rose). Data extracted from projections provided by the
provincial Department of Finance.
*Note: Constant dollars adjusted for inflation.
Net Sharing of Government Revenues
from Offshore Oil
Reflecting the Impact of Equalization and the Atlantic Accord
1200
Federal Corporate Income Tax
Revenues
Provincial Equalization Losses
(Federal Savings)
Net Provincial Revenues Af ter
Equalization Losses
millions of dollars*
1000
800
600
400
200
23
22
21
20
19
18
17
16
15
14
13
12
11
10
09
08
07
06
05
04
0
Fiscal Year
Source: Projections based on the existing projects (Hibernia, Terra Nova and White Rose). Data extracted from projections provided by the
provincial Department of Finance.
*Note: Constant dollars adjusted for inflation.
Net Sharing of Government Revenues from Offshore Oil
1200
Net Federal Benefit
Net Provincial Benefit
millions of dollars*
1000
800
600
400
200
23
22
21
20
19
18
17
16
15
14
13
12
11
10
09
08
07
06
05
04
0
Fiscal Year
Source: Projections based on the existing projects (Hibernia, Terra Nova and White Rose). Data extracted from projections provided
by the provincial Department of Finance.
*Note: Constant dollars adjusted for inflation.
CHURCHILL RIVER –
CHURCHILL FALLS
Has shaped perception of our place in
Canada
Inequities are profound and long term
No prejudicial action in Gull
negotiations
NOT DIRECTLY LINKED TO
GULL ISLAND DEVELOPMENT
CHURCHILL RIVER –
GULL ISLAND
Failure to develop for past 30 years
Time now to develop Gull Island
Government of Canada must be key partner in
development
Three-way partnership (NL, QC, GC)
Respect for Aboriginal interests and
environmental issues
GULL ISLAND NEEDS GOVERNMENT
OF CANADA AS PARTNER
FEDERAL PRESENCE
No Supreme Court Judge, only one Deputy
Minister
Federal budgetary cuts of 1995
proportionately greater in NL (highest at 38%)
No departmental Atlantic regional
headquarters here (17-NS, 11–NB, 1–PEI)
Ex. Gander weather office closed
Ex. CHHC office in Calgary not St. John’s
NL POORLY REPRESENTED IN
FEDERAL INSTITUTIONS
ATLANTIC “REGION”
Too often NL interests become invisible when integrated
with Maritime provinces
No common “Atlantic” identity of people in NL, NS, NB,
PEI
NL has separate history, larger and more diverse
geography, different social and economic interests
Pursuit of “Atlantic” agenda on case-by-case basis
preferable
Pursuit of “Atlantic” agenda on general, all-purpose
common front not desirable
FEDERAL EMPHASIS ON
REGIONS NOT PROVINCES
“It may not be a pleasant thought, but
distance from the centre is, in far too many
ways, for far too many people, the very
measurement of this confederation’s worth
and meaning.”
Rex Murphy, CBC Commentary “The East
Coast Fishery”, The National, May 6, 2003
THE LOCATION CHALLENGE
Joint funding for improved transportation
infrastructure
Joint funding for improved communications
infrastructure
Improvements to Gulf Ferry a la Terms of
Union
Enhanced federal support for research
GULF FERRY KEY LINK TO
REST OF COUNTRY
INTERGOVERNMENTAL STRATEGY
Strong team led by Premier or Deputy Premier
Focus: renewing and strengthening our place
in Canada
Need for comprehensive and cohesive strategy
based on this Report
Strategy pursued on all fronts, at all levels
Alliances built with other provinces
RELENTLESSLY PURSUE STRATEGY
KEY ALLIANCES
Quebec – Labrador hydro,other
shared resources
Nova Scotia – offshore oil and gas
Alberta – Senate reform
All provinces/territories –
Equalization
BUILDING ALLIANCES –
OUR NEW WAY OF RELATING
A country is nothing other than people and we are
no stronger than the weakest. Each of us and all
of us are better when we make decisions that
reflect our long held values of compassion, fairness,
respect and decency. We bring this message
around the world; it is time we brought it home.
Ross Reid, Opinion Piece for the Commission
ASSESSMENT OF PROGRESS
PATHWAY TO RENEWAL
If pathway works, progress evident in
short term
Full assessment of progress needed
after two years
Report to people of province on or
before June 30, 2005
JUNE 30, 2005
BETTER AND BRIGHTER FUTURE
No magic solutions
Make the case now
Pursue relentlessly to conclusion
Canada needs place in Newfoundland
and Labrador
FUTURE WORTH PURSUING WITH PASSION
PATHWAY TO RENEWAL
Reason dictates pursuing collaboration
Unforgivable that stock rebuilding plan not in
place
Lower Churchill partnership entirely realistic
Government of Canada as principal beneficiary
defies logic
Joint management a compelling and legitimate
goal
PATHWAY BUILT ON ACCOMMODATION
PULLING TOGETHER
Put an end to Labrador alienation
Meet challenges of rural sustainability
Make social inclusion a way of life
Choices for youth essential
Fiscal prudence a pre-requisite
RENEWED AND STRENGTHENED PLACE
FAIRNESS, EQUITY, RESPECT
Get on with what needs to be done
End confrontation
End dismissiveness
Begin collaboration
Begin new partnership
FINDING OUR RIGHTFUL PLACE