Executive Summary

Issues and ideas

Canadians have long been committed to the concept of sharing and the idea that, no matter where people live, their children should have reasonably comparable opportunities to get a good education. They should have comparable health care, social services, and other essential public services. And they should pay for those services with reasonably comparable levels of taxes.

The territories’ determination to become self-sufficient and self-reliant is an important priority for Canada. Changes to TFF should support the territories in achieving their goal of self-sufficiency.

TFF has been in place since 1985–86. Although it has been through a number of modifications, the basic idea underlying the program is that a federal grant helps fill the gap between the amount of money a territory needs to allow it to provide “reasonably comparable” public services and the amount of revenue it can raise from a combination of taxes and other sources of funds. When the program was first established, the amount of funding provided through TFF was considered adequate to meet expenditure requirements in the territories.

As part of its consultations about TFF, the Panel heard about a number of issues related to how TFF works today and ideas about how it could be improved. Key issues focused on:

• The adequacy of TFF in meeting unique needs in the territories and the clear message that current funding levels, even with the funding increases in the past two years, are not sufficient to meet their needs or reflect substantially higher costs, particularly in Nunavut.

• A recognition that, although the territories have similarities and similar challenges, they are distinct, with different circumstances, and they should be treated in comparable but separate ways.

• The importance of self-sufficiency and economic development in the territories and ensuring that TFF supports both of these goals.

• The negative impact of the New Framework introduced in October 2004 and the idea of a fixed pool on relationships among the territories.

• The need to make TFF more simple and transparent, thereby improving accountability to Canadians.

• The importance of making TFF flexible enough to accommodate agreements on Land Claims, Aboriginal self-government and devolution and resource revenue sharing.

Table of Contents	Next