The Canadian Constitution specifies which level of government is responsible for which government programs. For provinces, including Newfoundland and Labrador, it means responsibility for education, health care and some law enforcement among other areas. That doesn’t mean they have the total ability to control spending in any of these areas if the programs are directed by the federal government through policy, regulation or legislation.
The recently-released provincial budget shows that the tax burden on Newfoundlanders and Labradorians is already very high and much of the expenditures are out of our control.
Over the years, there has been significant pressure placed on provincial governments because federal governments have downloaded their programs and problems without sufficient (or any) money to manage them. This downloading by the federal government has hampered many provinces and has increased the tax burden on residents. The current situation is bad enough. However, what the government in Ottawa is about to do will make it a whole lot worse for Newfoundland and Labrador.
Two specific initiatives are the reason so many provincial governments and so many taxpayers are upset. They are the implementation of a carbon tax and the plan to legalize the use and distribution of recreational marijuana.
Both are being brought in by the federal government with minimal input from its provincial partners and little direct feedback from Canadians. The policies and regulations have yet to be fully developed, but there is no doubt both will add an additional financial burden on provincial and municipal governments who fund police forces and other affected agencies. There are still many unanswered questions.
Who will pay for the increased compliance costs for businesses and municipalities of the carbon tax? Will it help or harm the competitiveness of Newfoundland and Labrador businesses? Who will pay for the development and implementation of regulations governing the sale and distribution of marijuana products? What about the additional police and justice resources and the increased medical, mental health and addiction services?
The federal government is implementing these policies without considering their impact on the finances of provinces, individuals and businesses. They have no remedy for the undue hardship that this will create.
Provinces have already put on notice that the revenue-sharing arrangements on the taxation of cannabis products will not nearly be enough to deal with the problems legalization will create. Police forces across the country have said they are ill-prepared to enforce the new laws and that they only have a handful of officers who are trained to deal with the complications of this new legislation, especially those related to driving under the influence of marijuana.
In just one example, the deputy commissioner of the Ontario Provincial Police (OPP) told a House of Commons committee that the OPP needs more time and money to train officers to recognize and handle drug-impaired drivers. He also said that there are just 83 OPP officers who currently have the drug-impaired driving recognition training. The Ontario force estimates it will need at least 400 to 500 officers to properly enforce the drugged-driving law and Newfoundland and Labrador will need its share as well. Nationally, the Canadian Association of Chiefs of Police estimates there needs to be at least 2,000 officers with the training, up from about 600 now.
Newfoundland and Labrador will have to get up to speed. That will be costly and will take time.
In addition, there are thousands of employers who are not equipped to deal with this legislation and keep their employees safe at work. According to a survey by the Human Resources Professionals Association, 71% of employers are “unprepared for marijuana legalization.” And almost half of all respondents said ensuring safety at work was their main concern.
On the carbon-tax issue, there is anger from coast to coast about the federal government’s program to unilaterally impose this new tax on provinces. For any province that won’t ‘voluntarily’ agree, they will have an equivalent tax levied by the federal government.
This is not only taxation without representation. It is increased taxation and an additional burden without adequate compensation for the increased costs.
It’s time for Ottawa to stop downloading its problems and costs to the provinces and taxpayers.
David Wells is a senator representing Newfoundland and Labrador.
This article appeared in the April 7th, 2018 edition of The Telegram.