the canada health act and the cabinet decision-making system of pierre elliott trudeau

Paul Barker The Canada Health Act and the cabinet decision-making system of Pierre Elliott Trudeau

Abstract: The cabinet decision-making system of the last Trudeau government was the object of much criticism. The system purportedly frustrated individual ministers, relied excessively on central agenices, and made policy-making difficult. Based on a study of the manner in which the federal government dealt with the issue of direct patient charges, this article argues that the failings of the Trudeau decision-making system were exaggerated. Instead of being seen as a flawed attempt to structure how Ottawa decides, the Trudeau system of 1980-84 should be viewed as an important contribution towards the development of an effective cabinet decision-making process.

Sommaire: Le systeme de prise de decisions en vigueur dans le dernier gouvernement Trudeau a fait l’objet de nombreuses critiques. Le systtme Ctait vraiment frustrant pour les ministres, s’appuyait beaucoup trop sur les organismes centraux et rendait toute decision politique difficile. En s’appuyant sur une etude portant sur la facon dont le gouvernement federal a aborde la question des frais directs aux patients, cet article montre que les faiblesses du systeme de prise de decisions sous le gouvernement Trudeau n’etaient pas aussi graves qu’on I’a dit. PlutBt que d’y voir une tentative infructueuse d’encadrer les mkthodes decisionnelles d’Ottawa, on devrait considerer que le systtme en vigueur de 1980 a 1984 a largement contribue h mettre sur pied un processus de prise de decisions efficace au sein du Cabinet.

The different versions of the cabinet decision-making system under Pierre Trudeau each attracted a great deal of critical comment, but none more so than the final version. The cabinet system of the last Trudeau government was purportedly cumbersome, overstaffed with central agency officials, and insensitive to the role of individual ministers. Not surprisingly, the resigna- tion of Trudeau as prime minister in 1984 led to major changes in the system. T h e general intent of these changes was to make the system less complex and more amenable to individual ministerial prerogatives.

Recently some of these changes have been reversed. The initial changes included a downplaying of the policy function of the Privy Council Office (PCO), a reduction in the number and role of cabinet committees, an increase in the responsibilities of political officials located in the Prime Minister’s

The author is assistant professor of political science at Brescia College, University of Western Ontario.

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Office (PMO), and the abolition of two ministries of state and a unit within the Department of External Affairs which performed a ministry of state function. With the more recent changes, the policy function of the PCO has been partly restored, the number of cabinet committees has increased, and the committees have again assumed an important place in the cabinet system.

These latter changes suggest that the weaknesses of the Trudeau decision-making system were overstated. For many, the system appeared to be an ill-conceived product of the style of the former prime minister and his closest advisers, but perhaps in reality it constituted a reasonable response to the demands of governing.

The purpose of this paper is to re-examine the operation of the Trudeau decision-making system of 1980-84. The paper presents a case study of the development of the Canada Health Act, a piece of legislation passed in 1984 by the Trudeau government in order to deal with the presence of hospital user fees and extra-billing by doctors. By looking at how the Trudeau cabinet handled this particular policy issue, the paper attempts to assess the validity of the criticisms directed at the Trudeau decision-making process. The paper concludes that there is reason to believe that the failings of the Trudeau system were exaggerated.

The findings of a single case study are, of course, not enough to reject criticisms of the Trudeau cabinet system. They should, however, put to rest simplistic evaluations of how decisions were made in the Trudeau government. More important, they should suggest to those charged with designing cabinet systems that they might benefit from looking back to the Trudeau years; the machinery-of-government specialists in the Mulroney government already seem to have done so.

The paper proceeds as follows. It first outlines the Trudeau cabinet system of 1980-84 and its reported failings. It then provides an account of the process by which the Canada Health Act was formulated within the cabinet system. Following this, the paper assesses the criticisms of the Trudeau system in view of the discussion of the Canada Health Act. The paper ends by examining the implications of the paper’s findings for the study of cabinet decision-making.

The Trudeau system The cabinet decision-making system of the last Trudeau government can be described in many ways. One way, following Clark’s historical review of cabinet systems in Canada, is to see it as a system that consisted of three parts, each of which operated in a specific manner.’ The three parts included the

1 CANADIAN PUBLIC ADMINISTRATION 28, no. 2 (Summer 1985).

Ian D. Clark, “Recent Changes in the Cabinet Decision-Making System in Ottawa,”

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cabinet committee structure, the central agencies and the support they provided to the cabinet committees, and the procedures for obtaining cabinet approval of proposals and more generally for tying together the various elements of the system.

The cabinet committee structure was comprised of twelve committees and the full cabinet. The senior committee, Priorities and Planning, which was chaired by the prime minister, allocated budgets, reviewed the decisions of other committees, dealt with major issues, and defined the government’s overall goals. More broadly, the committee represented the ‘‘ma’or forum

The four policy committees, Social Development, Economic and Regional Development, Foreign Affairs and Defence Policy, and Government Opera- tion, formulated and integrated policy in their sectors. A large part of this role in turn involved managing the “expenditure envelopes.” The expenditure envelope, an integral part of the government’s Policy and Expenditure Management System, contained the funds for a particular policy sector, and the job of the policy committee was to allocate these funds in a manner that maximized the effectiveness of policy.

Three other committees, the coordinating committees, focused not on making and integrating policy, but rather on coordinating various aspects of the government’s affairs. These committees included Treasury Board, Legislation and House Planning, and Communications. Also, there were four special committees, which considered such matters as regulations and orders-in-council, labour relations, security and intelligence, and developments in Western Canada. As well, there were various ad hoc committees set up to address issues of immediate concern. Finally, there was the full cabinet, which met infrequently and which found its traditional decision-making role assumed by Priorities and Planning and the policy committees.

The cabinet committee structure had two underlying aims. One was to centralize decision-making to cabinet. In earlier cabinet systems, proposals coming from departments went largely undiscussed at cabinet and were accepted as faits accomplir. Consequently, departmental officials, who contributed greatly to the proposals, had a large and important role in decision-making. The use of the cabinet committee was to give ministers a greater chance to assess proposals and thereby shift some of the influence over policy-making from officials to politicians.

Centralization of decision-making was also instituted to provide for a system of collective or collegial decision-making. The committees grouped ministers with linked responsibilities. This gave each minister a good opportunity to comment on proposals of other ministers that might have a

for consideration of the general directions for the government.” a

2 Canada, Privy Council Office, Thc Policy and Expenditure Management S9stem (Ottawa: Privy Council Office, March 1981), p. 19.

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direct bearing on his or her department. The result would be better coordinated policies.

A second aim was to decentralize decision-making within cabinet. Instead of a matter coming before the full cabinet of thirty or so members or an already overburdened Priorities and Planning Committee, it would first be analysed by a policy committee of ten to fifteen members. This would allow for greater ministerial participation and for a more in-depth review of policy proposals. Also, it was hoped that this would ensure that routine matters would be settled at the policy committee level, with only the most contentious and significant issues coming to either Priorities and Planning or the full cabinet.

The basic form and intent of the cabinet committee structure was, of course, not new to 1980. As Van Loon says, the cabinet committee structure of the last Trudeau government represented the logical continuation of a process started in the mid 1960s.’

The Trudeau system had many bodies and structures that could be considered central agencies, but the major ones were the PCO, the PMO, the Department of Finance, the Federal-Provincial Relations Office (FPRO), the Ministries of State for Social Development (MSSD) and for Economic and Regional Development (MSERD), and the Treasury Board Secretariat. Together they formed a second part of the Trudeau system.

The PCO had two interrelated roles. One was to act as a secretariat to the cabinet committees. In part this entailed providing secretarial assistance to the committees - ensuring the appropriate documents arrived on time, writing minutes, drafting committee decisions, briefing ministers, prepar- ing agendas, and so on. The cabinet secretariat role also involved the provision of policy advice to a number of agencies and individuals, including departments, committees without ministries of state, Priorities and Plan- ning, and the prime minister. This aspect of the cabinet secretariat role, especially in relation to the prime minister, gave the PCO a predominant role in the decision-making system.

The second role of the PCO was to act as the prime minister’s department. In this capacity the PCO supported the prime minister in matters concerning appointments, the portfolio responsibilities of ministers, and the organiza- tion and operation of the cabinet system.

Like the PCO, the PMO was closely tied to the prime minister. However, unlike the PCO, the PMO was more interested in the political health of the prime minister than in policy matters. Accordingly, it examined policy proposals and then briefed the prime minister (and sometimes policy

3 Richard Van Loon, “The Policy and Expenditure Management System in the Federal Government: The First Three Years,” CANADIAN PUBLIC ADMINISTRATION 26, no. 2 (Summer 1983), p. 280.


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committees) with a view to adding a “political ingredient.”4 Occasionally the PMO took an active interest in the policy side of the proposals, but this rarely translated into an important policy-making role.

The Department of Finance had two basic responsibilities. One was to assess the economic implications of policy initiatives and forward this assessment to departments, policy committees, and Priorities and Planning. The second responsibility, the traditional role of Finance, was the formulation of economic policy through, among other things, the development of the government’s fiscal framework and the subsequent preparation of the budget.

The overall function of the FPRO was to integrate policy relating to federal-provincial relations. This involved coordinating departmental nego- tiations with the provinces, advising cabinet committees and departments on issues with federal-provincial implications, briefing the prime minister, and making policy in respect of such matters as the constitution.

The purpose of the two ministries of state was to assist their respective committees, Economic and Regional Development and Social Development, in coordinating and assessing policies. This required each ministry to undertake a number of duties, but two turned out to be more important than the others. One was to coordinate the process of developing and presenting new proposals by chairing a committee of deputies whose ministers sat on the policy committee in question. The goal here was to allow the deputies an opportunity to review upcoming proposals; in effect it was a dress rehearsal of the cabinet committee meeting itself. The other duty was to assess new proposals - and in some cases help formulate them - and then to brief the committee chairman and committee members on the soundness of the proposals.

As for the Treasury Board Secretariat, it supported the Treasury Board and the policy committees by “focussing on the expenditure framework, resource costing, management systems, envelope system accounting, and the efficiency aspects of program^."^ In short, the secretariat handled matters relating to the financing and management of government action.

As can be seen, the central agencies of the Trudeau system played many different roles. However, each was oriented towards one overall objective, which was to provide support for the cabinet committees.

The procedures for gaining approval of a new proposal were as follows. In most cases the process began with a department and its minister. Together they would do some initial thinking on the issue and perhaps discuss it with other departments that might be affected. After this, the department would

4 Colin Campbell, GovcrnmenCc Vndtr Stress: Political Executives and Kcy Bureaucrats in Washington, London, nnd Ottawa (Toronto: University of Toronto Press, 1983), p. 82. 5 Privy Council Office, The Policy and Expenditure Mamagem& System, p. 8.



forward its proposal to the relevant ministry of state for an assessment. Once the ministry had completed its work, the department’s proposal (and the ministry’s assessment) would be examined by the committee of deputy ministers, at which time all departments associated with the policy sector would have a chance to comment.

In the next phase, the proposal would be sent to the PCO for placement on the agenda of the appropriate policy committee. As well, the ministry of state would provide the committee with its assessment of the proposal. At this time the other central agencies might also forward their comments to the committee or discuss the proposal with the ministry of state and the department. (The latter might even occur at an earlier point.)

The next step, assuming acceptance by the policy committee, would be to send the proposal to the PCO for analysis and placement on the agenda of Priorities and Planning. Here the PCO would brief the prime minister on the merits of the proposal and also on the positions of the committee members with respect to the proposal. As well, FPRO might speak to the prime minister if the proposal affected federal-provincial relations, and the Department of Finance would also have a chance to inform the prime minister of its concerns.

Depending on the decision of Priorities and Planning, the proposal would either be rejected, sent back to the department for further work, or forwarded to Treasury Board for any necessary operational funding and then, if necessary, to the Legislation and House Planning Committee for review of the legislation accompanying the policy decision.

Criticisms Each part of the Trudeau system was the object of rather severe criticism. The cabinet committee structure purportedly had at least four major failings. One was that the committees, with their emphasis on collegial decision-making, frustrated individual ministers and hindered them in their efforts to pursue policy goals6 For ministers, committee deliberations proceeded slowly and were vulnerable to compromises made simply to reflect the commitment to collective decision-making. A second failing followed from this first one. The collegial process reportedly made it difficult to determine responsibility for policies.’ Since everybody took part in the decision-making, no one minister was truly accountable.

A third problem, surprisingly, was supposedly the lack of collegiality. Sometimes ministers attempted to evade the committee structure and take their proposals straight to Priorities and Planning or the prime minister. Just

6 Jean Chretien, Straightfrom Ihe Heart (Toronto: Key Porter, 1985), p. 84. 7 Senator Michael Kirby, “Government Development and Resource Allocation,” Cmmenlator 2 (Spring 1985), p. 10.


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as troubling, ministers apparently raised few objections to the initiatives of their colleagues, with the result that “substantive priorities and policies proposed to give effect to them were too often driven by individual ministerial and departmental ambitions.”* In short, the old ways prevailed.

A final criticism was that the committee structure failed to decentralize decision-making within cabinet. In theory the policy committees were to make the important decisions in their respective sectors. But in practice they apparently dealt with only the small and insignificant matters, while the major ones went to Priorities and Planning.g

For many, the primary problem was not the cabinet committee structure, but rather the central agencies. A major criticism here was that there were simply too many of them, which in turn led to such undesirable developments as overly vigorous competition among central agencies and the consequent provision of uncoordinated policy advice to ministers. lo

A criticism with more serious implications was that agencies challenged ministers. In other words, the line separating appointed and elected officials was too frequently crossed by central agencies. For example, MSSD, in assessing departmental proposals not only criticized the intentions of line departments but also put forward recommendations which were at variance with those of the sponsoring minister. More generally, “public servants directly confront[ed] ministers on a footing that ma(de] them virtual colleagues.”

A third criticism related to the role of departments in the system. In some cases central agencies became involved in departmental decision-making at a very early stage. For some, this early particiption denied departments the freedom necessary for creative policy-making.’* A fourth and final criticism concerned the relationship between interest groups and central agencies. Traditionally, interest groups had relied on departments to represent their views in cabinet. But departments had lost some of their influence to central agencies, and interest groups had responded by attempting to widen their contacts to include central agencies. However, interest groups, claimed some, were not “able to create strong relationships with the central

8 Peter Aucoin. “Organizational Change in the Machinery of Canadian Government: From Rational Management to Brokerage Politics,” Canadian Jounal of Polilud Science 19, no. 1 (March 1986), p. 15. 9 Van Loon, “The Policy and Expenditure Management System in the Federal Government,” p. 278. 10 Aucoin, “Organizational Change in the Machinery of Canadian Government,” p. 16. 1 1 Campbell, Cwmlncnts Un&r Stress, p. 35 1. 12 A. W. Johnson, “Public Policy: Creativity and Bureaucracy,” CANADIAN PUBLIC ADMINIS- TRATION 18, no. 1 (Spring 1978). johnson is referring to an earlier version of the Trudeau system, but it seems safe to say that he would have found it easy to make the same point about the last version.



agen~ies .”’~ An important part of the cabinet system was thus closed to the outside.

As for the last part of the Trudeau system, the procedures, the criticisms were again numerous. John Turner, in his press release announcing the abolition of the two ministries of state in July 1984, summarized the prevailing view on the procedures of the Trudeau system: “. . . the entire decision-making process was too elaborate, too complex, too slow and too expensive.” l 4

A further criticism was that the major policies were formulated outside normal channels. Important policy decisions, such as those concerning the constitution, energy, and public sector wage restraints, did not have to pass through the system. l 5 Perhaps more damningly, the procedures supposedly did not produce sound initiatives. Under the Trudeau system, policy was “simply bad policy.”16

With the failings of the Trudeau system outlined, the paper now turns to an examination of the Canada Health Act. As indicated already, the aim of the following account is to provide a basis for assessing the criticisms of the Trudeau decision-making system.

The Canada Health Act In late March 1983 the government of Alberta announced its intention to introduce new direct patient charges o r “user fees” for hospital care and to increase existing ones. In response the federal minister of national health and welfare, Monique Begin, threatened to withhold federal cash transfers to the province. Federal legislation authorized Ottawa to take such action if provincial health plans failed to provide for reasonable access to care, and the minister felt that Alberta’s new system of user fees might indeed result in the denial of access to medically-required care. At this time Begin also

13 James Gillies and Jean Pigott, “Participation in the Legislative Process,” CANADIAN PUBLIC ADMINISTRATION 25, no. 2 (Summer 1982), p. 263. 14 James C. Simeon, “Prime Minister Brian Mulroney and Cabinet Decision-Making: Political Leadership in Canada in the Post-Trudeau Era,” paper presented to the annual meeting of the Canadian Political Science Association, Montreal, June 1985, p. 13. 15 Richard Van Loon, “Planning in the Eighties,” in Richard French, How Ottuwa Decldcs, 2nd ed. (Toronto: James Lorimer and Co., 1984), p. 171. 16 A. Paul Pross, “From System to Serendipity: The Practice of Public Policy in the Trudeau Years,” CANADIAN PUBLIC ADMINISTRATION 25, no. 4 (Winter 1982), p. 532. 17 The following discussion of the Canada Health Act relies largely on thirty-eight interviews with individuals involved in the development of the act. The list of interviewees includes both past and present senior officials with Health and Welfare and all major central agencies, four former Liberal cabinet ministers, representatives of nearly all pertinent interest groups, and two former senior officials of Ontario’s Ministry of Health. All quotations in this section of the paper are from the interviews.

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reiterated her well-known belief that both user fees and extra-billing by doctors should be eliminated.

Alberta and other provinces with user fees took little notice of the federal response. Since 1979 Ottawa, supported by the findings of two federal studies, had been saying that it was going to take action against direct patient charges, but nothing had been done - Begin’s comments represented just more blustering on Ottawa’s part. However, the provinces were wrong. A number of new considerations on direct charges had recently entered into the thinking of the federal government, considerations that favourably disposed it towards taking action against such charges. ’* And Alberta’s announcement on hospital user fees gave Ottawa the final reason it needed to move on patient charges.

The combined effect of Alberta’s announcement and the changed thinking of the federal government was to place the issue of direct charges into the federal cabinet decision-making process. For four years the matter had “burbled along,” always important but not important enough to warrant serious consideration by cabinet. Now this was to change, and by the end of the year the federal government would introduce into the House of Commons its solution to the problem of direct patient charges: the Canada Health Act.

The matter of direct charges was handled by the federal cabinet in two stages. The first resulted in cabinet agreeing to a proposal to end direct charges by reducing federal transfers to the provinces by the amount charged through extra-billing and hospital user fees. This stage covered the period from March 1983 to August 1983. The second involved the serious drafting of the legislation and the final consideration of the policy decision. This stage began in September 1983 and ended with the appearance of the Canada Health Act in December 1983.

First stage Initially the Department of National Health and Welfare assumed the lead on the Canada Health Act. The department had already done some studies on direct charges, and it was in the process of drafting, with the Department of Justice, legislation that would endeavour to show decision-makers how the federal government might deal with user fees and extra-billing. Now, with cabinet giving serious thought to restricting or even eliminating the charges, the department accelerated its work in this area.

The predominance of Health and Welfare at this point was partly a result of the procedures of the cabinet system. Departments were supposed to take charge at first, to come up with recommendations that could then be

18 Chief among these was the belief that the issue of direct charges could be used to great advantage in the forthcoming federal election.



assessed by other line departments and central agencies. The style and interests of the minister of health also pushed Health and Welfare out in front of everyone else. The minister preferred to work alone, believing that other ministers should look after their own departments and that central agenices “got in the way.” Further, action on direct charges for the minister was a “personal initiative,” indeed a “moral act” that required immediate attention.

A final reason for the predominance of the department was the stance of senior departmental officials. Like the minister, they wanted to make sure that something was done and that it was done correctly. T o these officials, this meant that any entity that might imperil this goal - central agencies, in particular - should either be excluded from the process or have its participation severely curtailed.

Despite the department’s quick start on the act, Health and Welfare was not without its problems. There was some uncertainty about the department’s ability to successfully proceed with the issue. Health and Welfare’s experts, the ones who could be expected to provide the required bureaucratic input, harboured doubts about eliminating direct charges (especially hospital user fees). They feared, among other things, that such action would violate existing health care agreements between Ottawa and the provinces. This reluctance of the experts effectively deprived the department of the expertise required for the development of the Canada Health Act.

There was also some question about whether or not the department could steer the legislation through the cabinet system. Although cabinet had given an initial go-ahead to examine the matter of direct charges, there were still some cabinet ministers who had reservations about taking strong action against user fees and extra-billing. Any proposal to get rid of the charges thus demanded a department knowledgeable about the workings of the cabinet system, and Health and Welfare had not gone through the system with a major proposal for some time.

MSSD quickly recognized Health and Welfare’s position. It saw that the department was in some trouble and believed that it could deal with the department’s shortcomings. With its coterie of experts, which included former Health and Welfare officials, MSSD felt that it could provide the required expertise. Moreover, with its proximity to and experience with the cabinet process, it also felt that it could help Health and Welfare pilot the legislation through cabinet.

MSSD’S interest in this policy issue, however, was not just a consequence of perceived problems in Health and Welfare (or of the fact that the ministry was supposed to participate in departmental planning). MSSD officials assigned to the Canada Health Act were committed to banning direct charges, believing that the charges added to the country’s health care bill without any appreciable benefit, constituted a tax on the sick, and eroded


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access to care. These same officials also thought that the charges violated the conditions under which the federal government made transfers to the provinces for health care. Not only should the federal government act, the officials felt, but it had to act.

The combination of Health and Welfare’s problems and the position of MSSD soon brought the two agencies into a close working relationship; MSSD

became an “ally” of those in Health and Welfare who favoured acting against direct charges.

The two agencies set to work on eliminating direct charges. The agreed-upon goal was to force the provinces to eliminate the charges without disrupting the provincial health plans. It was known that Ottawa itself lacked the constitutional authority to ban the charges, so it would have to be done through the financing arrangements. Already Ottawa had the authority to withhold all cash transfers if the provinces failed to respect one or more of the principles of medicare, but this would be a decided over-reaction to direct charges and would throw provincial plans into great turmoil.

What was required, then, was a more subtle approach. A number of options were reviewed, but one soon became apparent as the preferred course of action. The federal cash transfer would be reduced automatically by the amount charged through extra-billing and user fees. The reductions under such an arrangement would not be enough to cripple provincial health programs, but they would be enough to make the provinces think about banning direct charges. As well, both MSSD and Health and Welfare believed that this type of fiscal penalty would make it politically difficult for the provinces to continue with extra-billing and user fees. The penalty would at a minimum identify those provinces that permitted direct charges, hardly a welcome development for any government.

Health and Welfare and MSSD acted to produce a coherent position on direct charges. However, this is not to say that the alliance was free of strain and conflict. MSSD thought that Health and Welfare was too secretive since it failed to share relevant information. As well, the ministry detected a certain arrogance in the department. MSSD would sometimes recommend a particular option, and Health and Welfare, after reviewing the recommendation, would simply say that it was unacceptable.

For its part Health and Welfare felt that MSSD was occasionally blind to what was required. MSSD, it seems, was willing to take actions that were clearly unconstitutional, which only reinforced the department’s view that central agencies had the capacity to derail this policy initiative.

MSSD was not the only central agency that quickly became involved in the process. As mentioned, the cabinet procedures allowed for early interven- tion into the decision-making process by central agencies. Not surprisingly, then, given that any action would have implications for federal-provincial relations, FPRO soon became part of the deliberations. At this time FPRO



wanted to establish some decorum in dealings involving the federal government and the provinces. Ottawa’s actions on energy and the constitution had done great damage to relations between the two levels of government, and FPRO was committed to rectifying this situation. From this perspective, FPRO was not greatly enamoured of any attempt to ban direct charges. It believed that such action could produce another unilateral federal initiative, since the provinces had made known their opposition to federal action in this area.

However, FPRO realized that cabinet - and Begin - was committed to examining the issue. Put differently, good relations with the provinces assumed less importance than dealing with direct charges. Accordingly, FPRO grudgingly set aside its reservations and proceeded to assess the soundness of the proposals coming forward on extra-billing and user fees.

First, it commented on the substance of the proposals emerging from Health and Welfare. In examining the proposals, FPRO felt that the department had failed to see the implications of its recomendations for federal-provincial relations. One of the major concerns of FPRO was the impact of the federal stance on Quebec, yet this had been given little consideration by the department (and MSSD). FPRO also questioned whether or not the favoured option - matching the amount of direct charges with federal cash withdrawals - would have the desired effect. If Ottawa was going to act aggressively once again, then FPRO wanted to make sure that the action was worth taking, that the fiscal penalty would in fact cause the provinces to eliminate extra-billing and hospital user fees.

Secondly, FPRO coordinated some of the work being done on the act, principally by chairing a committee of senior central agency officials whose job was to oversee the development of the proposals. The committee of deputies tied to the Social Development Committee also performed this role, but it was felt that the importance of the matter at hand required the close attention of Ottawa’s top public servants.

The other central agency that played a fairly important role in the early phases was the PCO. Its major concern was simply to “manage the issue.” Unlike MSSD, PCO lacked the expertise to discuss the substance of the policy alternatives, but it did have the responsibility to make sure that cabinet directives were being followed and that the issue was thoroughly discussed. Interestingly, PCO, as with FPRO, had trouble accepting the arguments for eliminating charges, but the cabinet directive had been given.

The other central agencies had little or no impact on the process. Given the absence of a significant expenditure element in the policy, the Treasury Board Secretariat simply watched the proceedings and briefed its minister on what it saw. For its part, Finance largely viewed the matter as a health policy issue, not as a fiscal issue, and consequently took little interest in the deliberations; as well, Finance had more important concerns at this time, one


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being proposed financing arrangements for post-secondary education. Finally, the PMO, through discussions with Health and Welfare and MSSD,

satisfied itself that the appropriate work was being done and then went on to deal with matters where developments were not proceeding as expected.

In the early part of the first stage, much of the relevant work occurred at the bureaucratic level, largely because the work at the political level - establishing direct charges as a high priority - had already been accom- plished by Begin. However, there were a few noteworthy occurrences at the political level. At this time, the spring of 1983, Begin was busy criticizing her provincial counterparts for allowing direct patient charges. The intent here was to prepare Canadians and the provinces for federal action on the charges, and to convince the minister’s cabinet colleagues of the wisdom of such action.

The minister and her immediate staff were also concerning themselves with some immediate developments within the cabinet system. They were worried about the central agencies. They believed, correctly, that most of the agencies opposed the banning of direct charges and were offering “passive resistance.” Even MSSD, which was in favour of strong action, was viewed suspiciously by the minister and her political officials. As a result, the minister tended to ignore the advice from central agencies, something which only added to the department’s reputation for being arrogant.

Fortunately for the government, the effect of the minister’s attitude was negligible. The minister continued with her efforts to politicize the issue of direct charges and the officials continued with their work on the details of the proposals. There may have been an uneasy relationship between the minister and the central agenices, but at least both were working towards the same general goal, which was to address the matter of extra-billing and user fees.

The work of the minister and the officials led to a series of cabinet documents which were forwarded to the Cabinet Committee on Social Development. The documents asked the committee to make decisions on a number of pertinent matters. Was the dollar-for-dollar proposal the appropriate penalty or should others be considered? What would be done with the withheld funds? What would be the implications of the proposed act for federal-provincial relations? How would the doctors react? Should there be any action at all?

The committee discussed these and other questions. Some members believed that any strong action would upset the provinces and induce the doctors to engage in a nation-wide strike. These committee members, predictably, opposed the initiative on direct charges. Other committee members supported action designed to end direct charges. However, while the committee reviewed and discussed the matter, it soon became apparent that it was reluctant to make any concrete decisions. The committee felt that


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the issue was too big for it to handle. It would have to be referred to Priorities and Planning.

The operation of the committee was also affected by the behaviour of the minister of health. The minister placed a low priority on the committee deliberations and sometimes sent senior health officials in her place. This stemmed partly from the committee’s reluctance to tackle the issue head-on and partly from the minister’s belief that it was often more important to talk to provincial health ministers, for example, than to attend meetings of the Social Development Committee.

The next step was for the appropriate briefing notes to be prepared for Priorities and Planning and the prime minister. At the level of intermediate officials this requirement engendered some conflict among the Social Policy Secretariat of the PCO (part of PCO assigned to the Social Development Committee), the Priorities and Planning Secretariat of the PCO, and FPRO. All wanted the responsibility to draft the notes for the prime minister, all claiming that they had the required information and insights. At times, when it was obvious that the expertise of the FPRO was required, for instance, the level of conflict was low, but more often than not “briefing politics” was the norm.

At the senior level there was more order. FPRO took on the major responsibility for directly briefing the prime minister, largely because the federal-provincial dimension of direct charges became more and more important. On the other hand, the senior PCO officials kept the prime minister informed about the activities of his health minister - they knew of Trudeau’s concern over whether Begin was going too far. Also, the PCO

provided the prime minister with information on the positions of the members of Priorities and Planning and on what could be done to ensure agreement at the cabinet table.

Once the briefings were completed, a meeting of Priorities and Planning was held. In fact, the matter of direct charges came to the committee many times. During the deliberations it became clear that there was major resistance to the dollar-for-dollar penalty. Some ministers argued against the penalty and any like action on the grounds that it was bad policy, that such action was unnecessary as the charges were not that high or wide- spread. Others took a more political stance, saying that there was no evidence of great concern among the voters about direct charges. Those who opposed the proposal, and they tended to consist of the right-wing element in Priorities and Planning, ostensibly supported the government’s commitment to addressing direct charges, but believed that what was before them was simply too much.

The minister of health, who was not a member of Priorities and Planning, had been invited to the meetings of the committee on direct charges. Seeing the opposition forming in the committee, the minister went to speak to the


PAUL BARKER

prime minister on her own. At the meeting the prime minister expressed his support for the minister’s intentions, and shortly thereafter, in late June or early July, Priorities and Planning made the decision to go with the dollar-for-dollar penalty. Through the u5e of various tactics, the prime minister, with the tepid support of his most senior ministers, had managed to deal with cabinet opposition.

The first stage thus ended in the summer of 1983 with cabinet giving approval to draft legislation that penalized provinces that permitted extra-billing or hospital user fees or both. The task now was to scrutinize carefully the draft and prepare it for final presentation to the cabinet committees.

Second stage As with the first stage, the second one began in Health and Welfare, in September 1983. However, this time the department’s experts became involved in the process, largely at the personal urging of the minister. The result was that there was a new team in the department assigned to the draft legislation.

The members of the new team found some serious weaknesses in the draft. For example, the draft offered a definition of “user fee” so ambiguous that it could be interpreted as including charges that were not meant to be subject to the fiscal penalty (for instance, charges for chronic care). For the new team the previous efforts had resulted in a rough draft of the legislation. It was up to them to make the draft presentable, which is what they proceeded to do.

Although the central agencies continued to play a role, the nature of their participation changed in the second stage. In the first stage they had been actively engaged in assessing the substance of the policy issue, but in the second stage their attention turned more to the process.

For its part MSSD assisted Health and Welfare in the preparation of the final cabinet documents. The aim of MSSD here was to sit down with the minister and her officials and determine a plan of action for guiding the submission through the system. The facts were all there, now it was a matter of putting them down on paper and formulating a strategy for ensuring that the proposal emerged intact from Priorities and Planning.

FPRO focused more on the political activities of the minister. For example, FPRO officials accompanied the minister to the last federal-provincial meeting on the Canada Health Act before the introduction of the legislation into Parliament. FPRO wanted to provide support for the minister, who by this time was under heavy attack from provincial health ministers. The PMO also concentrated on the minister’s activities, sending, as did FPRO, a representative to the last federal-provincial conference. The PMO was also actively developing a communication strategy for the act, believing - falsely



as it turned out - that it would be necessary to sell the act because of the expected opposition of the federal Conservative party.

The Department of Finance took a little more interest in matters during this second stage. This arose largely from its concern over the actual structure of the fiscal penalty and the means by which the federal government would obtain the information necessary to levy the penalty. Once these concerns were addressed the department again receded into the background.

At this time interest groups became involved in the process. Indeed they had been there from day one. Many of them had followed the same route, which was to approach Health and Welfare and present their concerns. For example, the Canadian Hospital Association, a group representing Canada’s hospitals, submitted a written brief on the proposed act and then met with the minister to discuss it. Other relevant groups, including the Canadian Public Health Association, the Canadian Labour Congress, and the Cana- dian Nurses Association, had done something similar. Some of these groups had also conveyed their views to Finance, but the focus of their formal efforts was Health and Welfare.

A few groups had employed different strategies for influencing the cabinet system. The Canadian Medical Association (CMA), for instance, met with the minister of health, as did other groups, but then took the extra step of approaching a number of central agencies. However, the central agencies refused to meet with the CMA. The official reason for the refusal was that the minister of health was the appropriate person to speak with. The real reason, according to the CMA, was that central agency officials had been told to avoid the doctors, who were adamantly opposed to the act. Interestingly, some other groups, those which supported the government on this issue, had contacted the central agencies informally and had successfully made known their concerns.

By November 1983 most of the necessary work had been done. Health and Welfare had cleaned up the draft legislation, MSSD had helped Health and Welfare plan a strategy for getting the bill through the system, Finance had pointed out some potential trouble spots, and interest groups had had their say. The bill was now ready for the cabinet committees.

Once again the Social Development Committee was apparently reluctant to deal with the legislation and the matter quickly went to Priorities and Planning. The expectation was that the senior cabinet committee would discuss the broad implications of the action and eventually confirm its earlier decision to go ahead with the legislation. But to the discomfort of some, it elected to examine some of the fine details. For instance, some members wanted changes made to the penalty provision so that Ottawa could use the withheld funds to reimburse patients charged directly for medical or hospital care.


PAUL BARKER

Eventually Priorities and Planning did agree to the Canada Health Act without making any major changes. The next month, on 12 December, the bill was introduced into the House of Commons. Although the bill would later find itself back in cabinet as a result of changes proposed by the Commons committee reviewing the legislation, the Trudeau cabinet system was effectively finished with the issue of direct patient charges.

Assessment of criticisms As stated earlier, each of the components of the Trudeau system was the object of much criticism. It is now time to examine these criticisms in light of the preceding discussion of the Canada Health Act.

The major criticism of the cabinet committee structure was that it involved too much collegial decision-making. The study under review suggests that this criticism was likely overstated. In the Social Development Committee few members made comments that had the effect of slowing down or weakening the proposed act. Indeed, the major complaint of the minister of health was that the committee did not have enough constructive things to say about the proposal.

The Canada Health Act is admittedly only one case, but it does seem indicative of occurences in the policy committees. Each minister realized that he or she would be bringing a proposal to the committee and that a critical review of another’s proposal would ensure reciprocal treatment. It was safer either to say little or to pass the matter to Priorities and Planning.

As for the deliberations of Priorities and Planning, collegial decision- making was much more in evidence here. Some members of Priorities and Planning severely criticized the proposal, so much so that it appeared at times that it would be rejected. However, the collegiality did not appear excessive in the sense that the committee picked the proposal apart over a long and excruciating process and eventually forced changes simply to suit the requirements of collective decision-making. l9 Instead, ministers voiced their concerns and then proceeded to make a decision on the Canada Health Act.

A second criticism of the committee structure concerned its tendency to blur responsibility for policy. For those who were involved with the Canada Health Act, it was very clear who was responsible here: Monique Begin. Accordingly this particular criticism requires some re-formulation.

A third criticism related to ministers who engaged in end runs around the committee structure in order to speak directly to the prime minister. In the case of the Canada Health Act, there was an end run, one that apparently

19 On this latter point, one interviewee, a cabinet minister in the Trudeau government, said that Priorities and Planning members played “hardball” and were not too concerned with face-saving.



tipped the scales in favour of the act. The Trudeau system, it seems, was vulnerable to ministers who would not play by the rules.

Another criticism was that individual ministers dominated both committee proceedings and more generally the development of policy. This case lends some support to this contention, for the minister of health (and her officials) monopolized the issue much of the time. However, Begin never dominated the process - at times she felt quite alone and without support - and she did find herself facing a stiff challenge in Priorities and Planning. Nevertheless, it seems safe to say that the level of collegiality in this case fell short of the expectations of the designers of the Trudeau system.

The last criticism to be considered in relation to the committee structure was that Priorities and Planning assumed responsibility for matters that properly belonged to the policy committees. The process by which the Canada Health Act came about forces a rethinking of this claim. As shown, the Social Development Committee wanted Priorities and Planning to take responsibility.

Again this is only one case. Still, it suggests that the critics may have had an excessively rigid view of the allocation of responsibilities among the committees (a product doubtless of the government’s equally rigid presentation of how the system was to work). One of the aims was to decentralize decision-making within cabinet - but not for all matters, as the critics seemed to believe. In truth, the locus of decision-making depended on the seriousness of the issue. The routine items went to the policy committees or were handled by individual ministers, matters of moderately high importance went to the policy committees, matters of great importance went to Priorities and Planning, and the most crucial matters were dealt with outside the system, by a few key ministers and officials.

A second set of criticisms dealt with the central agencies. Here the critics said that there were too many central agencies and that this led to destructive competition among them. A number of things can be said about this in relation to the case at hand. First, the case revealed little real destructive competition. Certainly some of the competition was undesirable, but it did not have an appreciable effect on the process. Secondly, some of the competition was actually beneficial, for it ensured that failings in the initial drafts of the proposals were caught. Thirdly, it did not seem that any central agency played a superfluous role. Ironically, the one agency destined to be dismantled, MSSD, was instrumental in the formulation of the act. And finally, the level of competition tended to be rather low at times partly because some of the agencies had more important matters to attend to; it was simply not the case, as some of the critics appeared to think, that significant policy issues attracted the attention of all major central agencies.

The critics also said that central agencies constantly challenged their political superiors. Explicit face-to-face challenges were not evident in this

10 1 ADMINISTRATION PUBLIQUE DU CANADA

PAUL BARKER

case. However, what was evident was great suspicion of central agencies on the part of the health minister and her staff - a challenge that was more imagined than real. Also, it could be said that the agencies implicitly confronted the minister through their analyses of the minister’s actions and her department’s planning. Stated differently, the collegiality in the Trudeau system often involved not ministers at committee, but rather ministers, line departments, and central agencies at different points in the decision-making process.

Central agencies were also accused of stultifying the creative energies of departments. This may have been true in some instances, but not in this one. This case suggests that departments may at times lack the creative spirit and require the assistance of central agencies to ensure the formulation of acceptable public policy.

The last criticism of the central agencies concerned their impact on interest groups. This case suggests that the absence of close ties between interest groups and central agencies may stem partly from the fact that the former do not actively pursue the latter. However, the case also shows that central agencies may on occasion discourage the establishment of such ties, especially with those opposed to the government’s viewpoint.

The final set of criticisms dealt with the procedures of the Trudeau system. The primary complaint was that the procedures made policy- making slow and cumbersome. Viewed one way, the case under review corroborates this claim, given that the issue of direct charges had been considered since 1979. But viewed another way, this case challenges the claim, given that the issue was acted upon quickly once it became a priority. As a former senior PCO official said in an interview. “the system could move fast when it wanted to.”

A second criticism pertaining to the procedures was that some issues, the big ones, were considered outside the system. As already suggested, the intent was never to have all the issues addressed inside the system. However, the fact that the extra-billing legislation, which represented a significant policy issue, went through the system suggests that only the most important matters were handled in different channels.

A final criticism was that the system produced bad public policy. Some have characterized the Canada Health Act as such, but others have thought otherwise. The conflicting views on the act make it difficult to condemn the system on the grounds that it produced policy of poor quality. But it might still be possible to criticize the workings of the system on the grounds that the proposal went through the system without being properly analysed. A look at the process that led to the act, though, shows that the system was not vulnerable to such a charge. Indeed, one official who was involved in the formulation of the act and who now holds a senior position in the federal



government said that many of the unfortunate policy decisions of the Mulroney government might have been avoided if policy proposals had been forced to undergo the same kind of review experienced by the Canada Health Act.

Conclusion “The exigencies of governing,” write the authors of a recent study of the Mulroney government, “[are] starting to turn the clock back.”*’ The authors are referring to the various decisions of the Mulroney government to reintroduce some of the features of the Trudeau system. Apparently the present government in Ottawa has found something positive about the way in which its predecessor made decisions. This development, this turning back of the clock, reflects the major finding of this study, namely that the failings of the Trudeau system were exaggerated.

This finding has at least two implications for the study of cabinet decision-making in Canada. First, and most obvious, the operation of the Trudeau decision-making system was mis-specified: the critics presented a distorted view of the system. The second implication, one which also flows from the above-mentioned decisions of the Mulroney government, is that the Trudeau system most likely constituted a step in the right direction in respect to instituting an effective cabinet system. The system was far from perfect, but the case of the Canada Health Act suggests that the system represented a laudable attempt to face the challenge of governing.

20 David Bercuson, J.L. Granatstein, and W.R. Young, Sacred Trust? (Toronto: Doubleday, 1986), p. 60.


the canada health act and the cabinet decision-making system of pierre elliott trudeau

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