Threat of separation led to a superior immigration system

No federal government likes to give up control but in the case of immigration, it’s worked out for the best.

image: Study International

Our immigration system is admired globally. Canada has largely avoided the divisive immigration debates that have plagued our close allies: the United Kingdom, the United States, and Australia.

A Gallup poll shows that Canada is more welcoming to immigrants than any other country in the world.

Decentralization of immigration began in 1991 with Quebec’s demands to have more control over French-speaking immigrants in order to better integrate them into Quebec’s distinct society.

The federal government, worried about Quebec separation, acquiesced to Quebec’s demands. Ottawa still controlled family sponsorships, refugee migration, and ensured that newcomers passed health and security screenings. But other than that, Quebec could create its own system and decide how many new immigrants to accept each year.

Then the me-too effect kicked in. Once Quebec had some control of immigration, other provinces wanted it. Ottawa was happy to give up some control to provinces because, at the same time in the nineties, Ottawa was going through a debt crisis and was happy to transfer those costs to the provinces.

So, in 1996, the Provincial Nominee Program (PNP) was created. The federal government would retain the rights it had in Quebec’s case but the provinces would design the programs themselves and much of the work -and cost- would be borne by the provinces.

Under the PNP, employers and postsecondary institutions with the cooperation of the provinces, would select applicants.

The provincial programs offered an easier route to permanent residency than federal programs did.

Critics argued that the PNP would be a disaster. Employers, provinces, and postsecondary institutions, they argued, didn’t have national interests at heart. And they don’t have the expertise to support language skills and integration of newcomers. Those who ran the immigration programs were often unskilled and open to fraud.

Another criticism of the PNP was that Immigrants could shop around for provinces that offered the best entry programs and then move to wherever it suited them.

At first, it was so. Big cities attracted immigrants because of their existing multiethnic communities where newcomers share the same languages and observe the same customs.  Toronto, Montreal, or Vancouver were often the final destinations because they already had networks of friends and family to help them launch a Canadian life.

As a result, only 28 percent of nominated immigrants to Prince Edward Island since 2008 were still living there. Manitoba did better, retaining 84 per cent. The difference, says Kelly Toughill in her feature-length article, was each program’s ability to support newcomers (the Walrus, May, 2021).

But despite initial problems, decentralization of immigration has successfully continued with groups like the non-profit Kamloops Immigrant Services. The Canadian Labour Congress is now controlling some phases of immigration to fill the looming construction labour shortage.

The number of localized immigration programs has swelled to more than 100 scattered from coast to coast to coast.

Canada now has one of the most complex immigration systems in the world.

Flexibility means that provinces and agencies design programs attract who they want, where they want.

Our complex immigration system has also resulted in the highest public support for immigration of any country in the world. And it’s why Canada is winning the global competition for labour.

Kenney should be careful what he wishes for

Alberta Premier Jason Kenney wants Canada’s equalization formula adjusted to be fairer to Albertans.

image: Macleans

When it comes to equalization payments to provinces, Albertans think that there must be a mistake. They see themselves as contributors to Quebec at a time when Quebec’s economy is on a roll and Alberta is in the dumps.

Kenney is being disingenuous when he claims that the current formula is unfair. His government was the author of the current formula in 2009 when he was a cabinet minister under the Harper Conservatives.

Kenney surely knows that one of the reasons Alberta pays more into equalization is that the province has more high-income earners. While only eleven per cent of Canadians live in Alberta, 21 per cent of Canada’s $100,000-plus earners live there.

Of course, high-income earners mean little if you are unemployed.  In October, 2019, Alberta’s seasonally adjusted unemployment rate was 6.7 per cent compared to Quebec at 4.7 per cent.

Income is just one factor in determining equalization says business reporter Konrad Yakabuski:

“The basis for determining whether any province qualifies for equalization payments is whether its fiscal capacity – the amount of revenue it could raise if it applied average tax rates, combined with its natural resource royalties – is below the national average. Despite a recession in Alberta following the 2014 crash in oil prices, and a slow recovery since, that province’s fiscal capacity remains far above the national average (Globe and Mail, Nov. 27, 2019).”

Kenny would like to see Alberta’s natural resources removed from this calculation, presumably so that Quebec would receive less. That plan would backfire because Quebec, too, has vast hydroelectric resources. Quebec would actually receive more according to calculations prepared by University of Calgary economics professor Trevor Tombe.  Kenney’s plan would have seen Quebec receive $10.1 billion more in equalization payments over the past decade.

Kenney argues that unlike Quebec, Alberta’s resources are non-renewable and should be an exempt. Yet it was Kenney’s government that decided it would be unfair to distinguish between renewable and non-renewable resources.

Quebec is a convenient straw man for Kenney, deflecting attention from the fact that Alberta’s riches were used in averting a provincial sales tax and not saved for a rainy day. Oil production was unwisely increased without the infrastructure to deliver it to market –a remedy my pipeline, the “people’s pipeline,” is about to resolve with construction under way.

Quebec’s budget surplus has to do with taxes –Quebec’s tax rates are 30 per cent higher than the Canadian average, whereas Alberta’s are 30 per cent lower. Kenny doesn’t have the courage to address Alberta’s real tax problem: no provincial sales tax.

Alberta’s wealth is, in part, the result of my tax dollars being pumped into the oil and gas industry. The feds recently announced a federal aid package for Canada’s oil and gas industry amounting to $1.6-billion.

As an author of the current formula, Kenney knows that the equalization is fair and yet he prefers to whip Albertans into a frenzy of retaliation and separation.