Canada assistance plan act

Reference re Canada Assistance Plan (BC), [1991] Facts:

Canada Assistance Plan authorized federal government to enter into agreements with provinces to pay contributions toward their expenditures on social assistance and welfare. Plan specified certain conditions for eligibility, but left it to provinces to decide how to spend it. Agreements could be terminated or amended by consent, and regulations affecting them would be ineffective unless passed with consent of any province affected. Plan was silent on authority of Parliament to amend the Plan. Federal government entered into such agreements with each province in 1967. In 1990, federal government decided to limit its expenditures to reduce deficit, so that payments to Alberta, BC, and Ontario would grow by no more than 5%. BC initiated reference to BC Supreme Court, and Fed Gov appealed to SCC.

Issue: Can the federal government reduce contributions in this manner, or were they required to obtain consent of provinces affected?

Legal Reasoning: (Justice Sopinka) Most of the Plan is duplicated in a federal-­‐provincial agreement, but not the contribution formula (which actually authorizes the payments to provinces). s.42(1) Interpretation Act reflects principle of parliamentary sovereignty – BC government cannot bind Parliament from exercising its powers to legislate amendments to the Plan • The natural meaning of the words “authorized to pay…under the Act” in s.3 is that the obligation is to pay what is authorized and nothing more. by reason of s.54 amendment would have to be initiated by Fed Fed wasn’t legislating in Prov jurisdiction, it was only granting/withholding money The amending formula in s.8 obliges Canada to pay the amounts which Parliament has authorized them to pay pursuant to s.5  payment obligations under the Agreement change when s.5 is changed. Though this appears to deprive agreement of mutuality or binding effect, must remember that this is not an ordinary contract, but an agreement between governments.

Holding: Federal government did not break the terms of the Plan or the Agreement. Appeal allowed.

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