My Canada - Today and Tomorrow

Charles S. Coffey, Executive Vice-President, Government and Community Affairs, RBC Financial Group and 3rd Vice-President, The Empire Club of Canada; Heather Cohen, Grade 12 Student, North Toronto Collegiate Institute; Reverend Dr. John Niles, Rector, St. Andrews United Church, Markham and 2nd Vice-President, The Empire Club of Canada; Mark Binns, General Manager, Ivey Business Consulting Group and the son of our guest speaker; Fred Hyndman, Managing Director, Hyndman & Company Limited; Stanley Griffin, President and CEO, Insurance Bureau of Canada; Duncan Jackman, Chairman and President, E-L Financial Corporation and Director, The Empire Club of Canada; Professor Thomas Symons, Founding President and Vanier Professor Emeritus, Trent University; The Hon. Barbara McDougall, Advisor, Aird & Berlis LLP and Former Minister of External Affairs; and Ron Waite, Vice-President, Aliant.

Introduction by Bart Mindszenthy

Ladies and gentlemen, welcome to the third of our very special Premiers Speakers Series that will run throughout the season.

As you know, we have invited all the First Ministers to come and talk to us about their Canada--today and tomorrow. To articulate what they see as the major challenges and opportunities for our country in the next decade.

To support this important series, Ipsos-Reid, the national polling and research firm, graciously volunteered to check the pulse of the nation about the future for the Empire Club of Canada.

The results--recently compiled and released--show a strong and clear trend.

Everywhere across our country, the number-one concern 10 years from now out of the 14 areas of concern we had tested will be services for the elderly and their specific home and health-care needs. That's followed, nationally, by such issues as family health care, waste disposal, energy and a clean environment.

And in the Atlantic provinces, the rank order of these greater issues a premier can expect to face a decade from now mirror the national snapshot.

It's clear from the Empire Club survey that Canadians are united in their view of the challenges that await this great country and its provincial and territorial premiers and, I dare say, the federal government.

To see and download the full study, please visit our Web site at www.empireclub.org.

Today, we have the pleasure of welcoming Premier Patrick George Binns.

You will recall the famous old adage: go west young man. It referred to the challenge of finding one's fame and fortune. Well, Premier Binns, who was born in Saskatchewan 56 years and two weeks ago, did the exact opposite. After earning his master's of arts in community development from the University of Alberta, he headed east to the Prince Edward Island Rural Development Council in 1972.

Six years later, the man who would be premier was elected to the Legislative Assembly, then re-elected and assumed an impressive range of ministerial portfolios. From 1984 to 1988, he served in the House of Commons, followed by eight years in the private sector back on Prince Edward Island.

Nineteen ninety-six was a big year for this man from the West. He was elected Leader of PEI's Progressive Conservative Party. He was elected again to the Legislative Assembly and he was sworn in as the province's 30th premier.

And today, he can justly lay proud claim to being the first Progressive Conservative premier of the province in more than a century to win three successive majority governments.

As well, he co-founded the Council of Atlantic Premiers four years ago, while continuing to drive a focused agenda of growth for his province.

Meanwhile, his wife manages the family's dry bean processing plant and farm. Clearly, the premier is not the family "bean counter."

But what we do have is the young man from the West who went east and certainly has earned a place in Prince Edward Island history, who has earned respect and fame. Not sure about the fortune part!

Ladies and gentlemen, please welcome to the podium of the Empire Club of Canada, the Premier of Prince Edward Island, the Honourable Patrick George Binns.

Pat Binns

I am very pleased to be back, once again, to address the Empire Club of Canada.

While I can't promise to string words together like Stompin' Tom, who placed 13th on the CBC's list of top-50 Canadians, or impress you with feats of athletic genius like Conn Smyth winner and Stanley Cup Champion Brad Richards or Canada's top female golfer Lori Kane, I think I have a great story to tell, nonetheless.

My story is about a province on the move with a small but dynamic population--a region of the country ripe with economic opportunity. My story is also about PEI as part of the national and global economy. When SARS struck Toronto we too felt the impact. Japanese visitors to the Land of Anne immediately stopped coming. And as your restaurants and theatres slowed down, our world-famous seafood and potatoes lost an important market. But, being a friend, as we were in the great snowstorm of 1992, we helped Toronto rally with free truckloads of seafood and potatoes to help bring people back downtown. And it worked.

Despite 9/11, mad cow, hurricanes, the Atkins diet and U.S. elections, I can tell you that Prince Edward Island's economy is on the move. We are building an economy that is sustainable. Sustainable economically, socially and environmentally.

And while I don't have time to tell you about all the things we are doing to protect our great pastoral landscape or to find the balance between social programs and financial management, I will tell you that:

o Prince Edward Island's economic growth last year did outpace the national average.

o The average level of employment continues to grow at a significant rate. Our 2.5-per-cent employment growth rate exceeds the national average and represents the third-highest rate among all provinces.

o Total labour income expanded by 3.7 per cent in 2003 as we continue to move from a seasonal to a year-round economy with better paying jobs.

o Housing starts hit a 20-year high last year and look very good for 2004.

o While there have been challenges within the primary industries, our agriculture and fisheries sectors continue to post increased cash receipts year over year.

o The value of provincial exports was estimated at $350 million in 1996, and that number has doubled to approximately $700 million annually.

o In a little over 10 years our unemployment rate has fallen from an average of 18-19 per cent to an average of 11-12 per cent.

These few statistics indicate that profound change is affecting virtually every aspect of life in Prince Edward Island.

Our population is growing and at an all-time high.

Significant change has occurred in the structure of our economy, particularly the shift in employment from resource-based sectors to employment in the knowledge and service sectors.

I spoke earlier about the importance of exports to our island economy. We have over 430 manufacturers and processors. Key contributors to their growth are the availability of qualified human resources and suitable infrastructure. And of course, the longest bridge in the world over winter ice conditions has helped immensely. Due to the bridge, tourism doubled and truck traffic was up one-third in the first year alone.

PEI's reputation as a clean, safe, low-cost place to live and work provides further incentives for manufacturers and processors to locate and expand.

Cultural industries like arts and heritage represent the fastest-growing sectors of our economy. Sam (the Record Man) Sniderman, a seasonal resident, reminded me to tell you about the world-class Confederation Centre of the Arts--a memorial to the Fathers of Confederation. And I am delighted that Dr. Thomas Symons, Professor Emeritas and noted Canadian scholar, along with George Kitching are here today. They too are on the Board of Confederation Centre and along with Board Chair Wayne Hambly have shown great leadership towards our national institution and in promoting a national vision of Canada.

Under their leadership, the Confederation Centre will host the Inaugural Lecture on the State of the Canadian Federation on November 8. Premier Jean Charest has agreed to provide this important lecture and we would be honoured if any of you could join us on this important occasion.

Our province's unique landscapes, museums and heritage buildings, and talented artists all contribute greatly to our rich cultural diversity.

The Prince Edward Island brand is well established among the world-class golf destinations and great islands.

The aerospace sector is a relatively new component of the island economy. Following the closure of CFB Summerside in the late '80s it is growing into a key player with more than 700 employees and $180 million in sales each year. This represents about 20 per cent of total provincial exports and the industry continues to grow.

Companies such as Honeywell, Testori Americas, Atlantic Turbines and MDS-PRAD are putting a new face on our business community and have formed the nucleus for further aerospace development. Barbara McDougall, when Employment Minister, helped us transform the former air base in Summerside into a very successful aerospace park. Barbara had help from people like Reg Stackhouse and Sinclair Stevens who are here today.

The Atlantic Technology Centre, located in Charlottetown, opened its doors in 2002 and is providing the growing IT community with leading-edge infrastructure. We have partnered with Bell Aliant, Hewlett Packard and Cisco to attract new investment to the province, while providing IT companies with increased access to export markets.

As a government we have identified life sciences, particularly biotechnology, as a priority for future economic development. We have been able to grow this industry to the point where it currently includes 32 island-based companies with annual sales of close to $100 million.

The ground-breaking establishment of the National Research Council Institute for Nutrisciences and Health at the University of Prince Edward Island is an exciting development and increases the potential for growth in this strategic sector. We are very proud of the development of our university under the presidency of Wade MacLauchlan and Chancellor Norman Webster. Our Atlantic Veterinary College and Food Technology Centre are paving the way for strong growth in the bio-resource field.

The picture I am painting is of a province rapidly transforming itself.

There exists an infectious mood of optimism in Prince Edward Island and we are poised to experience its greatest period of prosperity since the early 1800s.

And, we reform from within. We do not throw the baby out with the bathwater. For example, we have overhauled our auto insurance industry by working with that industry to provide wins for automobile owners, the companies and government and I am pleased to see insurance leaders like George Cooke, Stan Griffin and Fred Hyndman here today.

So, I welcome you--the firms that you represent and the industries that you are a part of--to come and share the emerging opportunities on Canada's east coast.

Of course, as Islanders we know that we are part of something bigger, something more complex, something very special and important.

What I speak of is Canada.

As a Canadian, who was born in Saskatchewan, raised in Alberta, spent four years in Ottawa, and has been a transplanted Islander for 33 years, I am proud of our vast land, our shared values, and the advantages and opportunities provided by Canadian citizenship. The Fathers of Confederation who met in my province in 1867 envisaged a society of freedom, tolerance and compassion and we have largely lived up to that expectation.

Canada's architects in 1867 understood that federalism was the only option for our nation-building. With its two principal orders of government, federalism allows diverse communities to be united in one country without suppressing their distinctiveness.

The intent of Canada's federal system not only gives room to regions or provinces to make decisions in their own areas, but also allows us to achieve objectives in other areas. Canada was intended to be both flexible and durable, adapting to our changing needs.

The Canada of today bears little resemblance to the Dominion created in 1867. Not in the territory it covers; not in its people; not in its economy; not in its culture. Our political institutions and federal system have been preserved in some respects and transformed in others.

Has our federation been durable over time? Yes. Has it adapted to continually meet our needs as Canadians? That answer is debatable but on average we have adapted.

As Canadians, we want political institutions that are more responsive to our wishes. We want a streamlined system of government, which minimizes unnecessary overlap, and institutions which encourage integrity rather than confrontation. Canadians from every region want federal institutions that will hear and act on the aspirations of all parts of the country. That's why we formed the Council of the Federation in Charlottetown last year.

The Canadian federation has proven its ability to endure over time. To endure we must change the way governments manage their affairs and dollars so we may better reflect the realities of modern-day Canada.

One of the principal driving forces behind Confederation was the vision that for certain matters more could be accomplished together, than apart. That Canada could provide a better future for its citizens as one country.

And in that one country there could be respect for diversity embodied in strong provinces. The provinces that joined together to form that country formed a political union, but also an important economic union.

The country has changed a great deal since 1867. At the time of Confederation, the Atlantic area was not a "have-not" region. Immigration, shipbuilding and international trade drove our economy. But, wealth shifted. Opportunities once abundant in our region, for a variety of reasons, including building an east-west nation, and restrictions on north-south trade and the impact of oil and gas prices shifted wealth from the Atlantic.

As I said earlier, we are on the rebound, but our federation has experienced regional disparity and a fiscal imbalance. By that I mean that there are regions of this country, which are able to provide a better level of health care and other government services than others. The one factor, which governs this disparity, is wealth.

Since I became premier in 1996, the government of Prince Edward Island has increased spending on the health of Islanders by more than 66 per cent. Since 2000, those costs have escalated by 37 per cent (average of over 7 per cent per year). This is not unlike other provinces and territories and is due to new drugs, new technology, and human resources costs, which continue to grow.

By contrast, total federal transfers to Prince Edward Island actually decreased by 2.2 per cent over the past three years. In the face of all of this, premiers engaged with the Prime Minister to address this issue in a meaningful way.

In the early days of medicare, many health-care costs were shared equally, on a 50/50 basis, by the federal and provincial governments. Today, provinces cover in excess of 80 per cent of the total costs.

A sequence of transfer cuts by the federal government changed all of this, especially in 1995 when Ottawa cut the CHST by $6 billion.

We have closed that gap, to some extent, with the agreement last month by premiers and the Prime Minister to a new health accord.

As First Ministers we are still working on a meaningful strategy to ensure that Canadians, no matter where they reside, have similar access to service at similar rates of taxation. To do so, we need not reinvent the wheel. The mechanism to fix this inequity already exists.

The principle and purpose of the Equalization Program has been with us for almost 50 years and has been entrenched in the Constitution of Canada since 1982. This is a defining feature of the Canadian federation and, to me, reflects the very underpinnings of what it means to be a Canadian-equity, fairness--regardless of where you happen to live or what your economic station might be.

Section 36(2) of the Constitution Act of 1982 commits the Government of Canada to: "…the principle of making equalization payments to ensure that provincial governments have sufficient revenues to provide reasonably comparable levels of public services at reasonably comparable levels of taxation."

This fundamental requirement of the Canadian Constitution has not, in recent years, been adhered to. While reinvestments since 1999 by the federal government in the CHST and CHT have been made, I can show that these investments have been principally supported by a steady erosion of the equalization program. In many respects, we have failed Canadians and we have failed to live up to the basic tenets of what makes our country unique and socially prosperous.

Next week, First Ministers will again convene in Ottawa to negotiate a strengthening of the Equalization Program and the fundamental principle of equity and fairness. For eight of 10 of Canada's provinces, the Equalization Program is a vital component of providing the health care, which Canadians expect and deserve.

Our collective approach must be responsible and sustainable for the longer term.

Most provincial and territorial governments have faced serious fiscal challenges especially since cuts to federal transfers in 1995 and due to changes to the equalization formula in 1999, which dramatically reduced federal payments. Prince Edward Island is no different from others. We cannot afford to expand our health-care system; it already consumes over 40 per cent of most provincial budgets. Our federal government on the other hand has posted significant surpluses, which are forecast to grow further.

So, we have a responsibility not to squander opportunities to move our country forward, together. Next week's First Ministers' Conference on the fiscal imbalance is one such opportunity that we must realize.

All regions of Canada must ensure that they are equipped to deal with the economic challenges of the next century. This is a shared responsibility.

If we are to maintain our prosperity, ensure a high standard of living for our children, and continue our efforts to reduce the disparities that exist between the regions of Canada--one of the most important and enduring principles of Confederation--we must be prepared to work together in a manner of collectivity and understanding.

If, we do so, this land of diverse regions, a free and democratic society, a land which is respectful of differences, a strong economic union and a sharing community providing equality of opportunity and economic security for all its people will be well equipped for the future.

I ask you to support Canada's political leaders in reaching fair and equitable solutions.

Thank you and God bless.

The appreciation of the meeting was expressed by Duncan Jackman, Chairman and President, E-L Financial Corporation and Director, The Empire Club of Canada.