Eliminate Interprovincial Barriers: New Think Tank

By Omid Ghoreishi, Epoch Times
June 23, 2010 8:20 pm Last Updated: June 23, 2010 8:30 pm

EDMONTON—The federal government must use its power to ensure there are no restrictions or impediments to the free movement of people, goods, services, and investment in Canada, says a report by a new think tank.

The Macdonald-Laurier Institute for Public Policy calls for the legislation of an economic charter of rights for Canadians and the creation of an “economic freedom commission” to investigate breaches of the charter.

“Establishing that Canadians have a right to move, work, and do business anywhere in Canada would be the much-delayed fulfilment of our founders’ dream of a great nation and of the deal they struck in 1867,” reads the 36-page report.

Provincial and federal measures and policies restricting interprovincial trade cause considerable economic harm and make Canada “less of a nation,” the report’s authors write.

“We believe that releasing this study on the eve of the G8 and G20 Summits in Canada underscores the paradox that, as Canada advocates freer global trade to offset the impact of the recession, and as we seek to make NAFTA even more effective in lowering continental trade barriers, we do not always practise what we preach at home,” Robert Knox, one of the authors, said in a statement.

Knox served as executive director of the Internal Trade Secretariat in the early 1990s. The Ottawa-based think tank describes itself on its website as a non-partisan organization conducting research on economic and public policy issues.

The report cites a few examples of the barriers currently in existence between provinces, saying that in many cases they are “visibly foolish.”

For example, different provinces mandate different standard sizes for milk or cream containers used for coffee. While the intent is to favour local producers, it comes at the expense of dairy farmers and processors elsewhere, as well as local consumers who would have fewer choices.

“Indeed, does anyone suppose that inhabitants of, say, Manitoba habitually add a tiny bit more or less cream to their morning brew? Has anyone ever said, ‘Whoa, that’s a Quebec dose you just put in?’” says the report.

Another example cited by the report is that it is illegal for someone to order wine directly from another province, or cross a provincial border with wine bought in another province. In yet another, Ontario and British Columbia have different standards for bus brakes that affect both passenger and freight vehicles.

“Can anyone suggest that buses in one or the other of these provinces do not stop when the brake pedal is depressed? Then why can’t the two provinces, while maintaining their own standards if they must, also declare that any bus-braking system acceptable in the other may be used in their own?” asks the report.

There are also interprovincial mobility barriers for Canadians working in regulated and trade professions.

There have been various attempts to put an estimate on the cost of Canada’s interprovincial trade barriers, with some estimates ranging from around 0.2 percent of the GDP to 1.5 percent. With today’s $1.6 trillion economy, if the cost is estimated at half a percent of the GDP, it amounts to $8 billion a year, according to the report.

“It is high time for the federal government to introduce a sweeping statute to ensure that no government rules or policies unnecessarily restrict the free movement of goods, services, labour and capital, and give individual citizens clear legal remedies against such restrictions,” the report says.

“Our proposal is good for all Canadians and good for their governments,” said Brian Lee Crowley, one of the author’s of the report and the institute’s managing director.

“It means greater prosperity, a stronger sense of nationhood, and a clearing of the cluttered agenda of provincial and territorial governments. It is an idea whose time has come.”

During the 2008 election, the report notes, the Conservative Party said that if trade, mobility, and investment obstacles were still in place by 2010, it would use federal authority to intervene.