POLI 101- November 7.docx

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University of British Columbia
Political Science
POLI 101

FEDERALISMCHARTERMonday November 7 2011Remainder of the Lecture on Federalism Fiscal Imbalances Different government attempt to fix the imbalance between provinces and federal government1 Vertical Imbalance Imbalance between areas of jurisdiction and their cost the ability to raise revenue EG The provinces are not able to raise as much revenue as the federal government yet are required to provide Healthcare service which is extremely costly to its residents One way to increase the provinces ability to raise revenue is through the federal government providing them with tax rebatesTax rebates in essence decrease the federal tax rate in certain provinces so that the provinces can raise their tax rate with no overall increase in the tax rate of residents2 Horizontal Imbalance Imbalance between provinces region to region A provinces ability to raise revenue is also dependent upon its natural endowment of resources The federal government uses equalization payments to ensure that all Canadian citizens regardless of where they live receive the same level of services and tax rate Lessens the impact of natural endowmentThere is a weak constitutional promise that ensures equalization paymentsEG Ontario is now receiving equalization payments Calls into question whether the equalization program can work as more and more regions are requiring payment spread between the have and havenot provinces is increasing Tension in the Federal System1 Healthcare Accord between provinces and federal government to fix healthcare will expire in 2014Provinces concerned that after the accord expires the federal government will not continue to provide the same amount of financial support for provincial healthcare systems Currently the government gives provinces a total of 40 billion dollars2 Regional discontent Conflict between provinces and the federal government often occur when the provincial ruling party is different than the federal ruling party3 Institutional and constitutional issues Senate reform 4 Growing disparity between provincesGap between the have and the havenots provinces is increasing Have Those with natural resources Havenots Those who specializing in manufacturing goods Coping Mechanisms Ways that difficulties and issues are overcome in the federal system
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