July 13, 1964 (26th Parliament, 2nd Session)


William Heward Grafftey

Progressive Conservative

Mr. Grafftey:

Mr. Chairman, in dealing with the particular question of federal-provincial financial arrangements I feel at the outset it is almost inevitable that we touch upon the general field of federal-provincial relations. I think most members in the house this afternoon will readily admit that the general subject of federal-provincial relations is perhaps one of the most, if not the most, impor-
Federal-Provincial Relations tant subjects confronting parliament and the nation at this time. I do not want to exaggerate but I think many of us would agree that to a very large extent national unity itself depends upon our resolve and determination to find solutions to the problems of federal-provincial financial or taxation arrangements and federal-provincial problems in general.
With this in mind, Mr. Chairman, I intend during my brief remarks this afternoon to treat the subject at hand under two headings. First of all, I should like to refer to some historical and contemporary background material pertaining to the subject and especially underlining the Progressive Conservative approach to the general field of federal-provincial relations and federal-provincial taxation arrangements in particular. Second, I should like to underline some basic problems involved in the whole question today before coming to what I hope will be considered some positive conclusions.

Mr. Chairman, allow me to read a few brief considerations which I deeply value about "unity within diversity."
The Canadian constitution is the first in the world to combine a federal government system with a parliamentary system.
I have always felt that a federal government system should try to conciliate a certain degree of unity with a certain degree of diversity.
In my opinion, Canada has never been and will never be united according to the principle of the melting pot.
As everybody knows, we have a vast and thinly inhabited country. Even if our population were to increase materially and our means of communication to become faster than ever, I would still believe that "unity in diversity" should remain the basic and essential factor governing our attitude towards Canada and its people.
Our federalism is based on a particular psychology in the variety of our peoples and provinces. Union is sought, but not unity in the matter of languages, cultures, religions, etc.
This attitude, based on "unity in diversity" should always be held as a positive and dynamic factor of our national character.
In a realistic perspective, that fundamental diversity of our national life raises many problems in the edification of a nation. We are facing some of those problems today. By merely paying lip service to the necessity of mutual respect and understanding, to the necessity of co-operation, we do not stress enough that attitude which advocates a policy of "live and let live". An all-embracing co-operation is undoubtedly essential, but the sooner we shall emphasize the positive glories of our diversity, the sooner the number of those who talk of a confederation crisis will diminish.

I felt, Mr. Chairman, that as I entered into the substantive part of the remarks I

Federal-Provincial Relations intended to make this afternoon I would put what I might term as a few keynote phrases on the record in French. It has always been my impression that one of the basic tenets of Conservative principles lies within the idea of local self-agency. I have said this in our House of Commons before, that we on this side of the house feel that people on the local level often know what is best for themselves and how best to govern their own affairs. In other words, the diffusion of powers constitutes a fundamental idea in our approach to federal-provincial relations.
This has been said time and time again, Mr. Chairman. Of course, we must have a strong federal government which must always remain strong and activist-I underline the word "activist"-within its constitutional responsibilities. There are those who would argue that Macdonald and Cartier advocated a strong central government. Well of course they did: They had no other choice. Before 1867 the parts existed but there was no whole. It was the primary task of the fathers of confederation to create the whole and to defend it. At the same time Macdonald and the other fathers of confederation profited from the experience of the drafters of the United States constitution who had witnessed the breakdown of their original central government which had been given too few powers by the original articles of confederation.
Briefly, Mr. Chairman, Conservatives fight extremes wherever and whenever they exist. In the United Kingdom for example a Conservative administration defended strong central government in the last century. They defended it against privilege. Yet today a Conservative administration in England fights against the tendencies toward over-centralization, if you will, of the socialist state. In brief, Mr. Chairman, the Conservatives' respect for diffusion of powers dictates that we discourage any exaggeration toward centralizing tendencies.
When we say that our party was the party of confederation, this means much more; it has a much greater significance than the mere fact we were in power in 1867. The spirit of Macdonald and Cartier means much more than that, Mr. Chairman. It means you have two great languages and two great cultures forming the real glory and the real strength of Canada. Today the same spirit includes Canadians of many cultural and ethnic origins as we work together to build our country. This spirit of unity in diversity keynotes the fact that the melting pot theory is not applicable to the Canadian mosaic. We have

noticed, sir-and the Minister of Finance made reference to this-we have noticed that during the war years and the immediate postwar years we had strong centralized governments in Ottawa. I think it is generally recognized that today the pendulum is now swinging towards the provinces at a time when the national government has been directed by a series of minority administrations.
I repeat, and probably will repeat again in my remarks, that I believe we should always have a strong and activist central government, but it should be strong and act only within its constitutional responsibilities. The suggestions and proposals I make this afternoon are not based on a defence of the centralist position; they are not based on a defence of provincial rights. They merely recognize, Mr. Chairman, the facts of life in Canada in 1964. Disraeli criticized the Whigs for overcentralization while they divided sections of the country against one another. In Canada, sir, the same can be said of successive Liberal administrations which have encouraged excessive centralization based on a divide and rule approach. Mr. Lesage recognized this, and today in the province of Quebec the Liberal forces are splitting in two. Liberalism in Quebec has never said the same thing as it has said in the rest of Canada-

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