Prime Minister Paul Martin
Room 309-S, Centre Block
House of Commons
Ottawa, ON K1A 0A6

Dear Prime Minister:

As you may be aware, I have been advocating the concept of decentralization in the federal government for some time now. I believe the success of such an initiative was proved by the relocation of the national headquarters of Veterans Affairs to Prince Edward Island.

In my opinion, bureaucratic power has been overly centralized in the hands of a small group of institutions closely concentrated in the capital region.

I believe that now is the time for the Government of Canada to separate policy from process - that it is time to decentralize federal departments, agencies and Crown corporations, away from the National Capital area, to the regions of Canada.

While efforts were made in the past, the reluctance to pursue decentralization was compounded during the period of federal fiscal constraint that began in February of 1995. That year, as you are well aware, the federal budget announced government wide plans to eliminate programs and decrease the size of the government workforce.

According to the Treasury Board website, since 1995, provinces like Manitoba and British Columbia lost thousands of Federal public service jobs while employment in the National Capital Region remained constant. At the highest executive levels of the public service, the Ottawa area has continued to hold 70 per cent of positions from 1994 to 2003.

In my view, there are many potential benefits of decentralization in Canada. The initial, up-front costs of relocation would be recouped many times over, in many different ways:

• The region receiving the relocated institutions would secure well paying, permanent positions;
• In turn, such moves would reduce the need for other forms of regional development;
• The affected departments or agencies would reduce staff turnover, and save recruitment and training costs;
• Perhaps just as important as any other factor, the Government of Canada would gain a permanent and strong presence in the affected region - which would help to reduce the stresses of regional alienation.

Relocation should be done, not only as an economic development tool, but because it is a logical move that better reflects the challenges of a geographically vast and diverse nation.

For example, the National Energy Board was relocated to Calgary many years ago and is now closer to energy production. Why then, is the Export Development Corporation currently located in Ottawa? It could be situated in Vancouver; after all, Canada does more than 20 billion dollars of trade with the state of California alone.

Does it make sense for the employees of the Department of Fisheries and Oceans to locate themselves in downtown Ottawa, where they cannot see a harbour or a fishing boat? Or does it make more sense for them to be located on one of Canada’s coasts, where they can see the impact of their decisions on fishing communities and their residents more directly?

Some will say that it is too difficult to embark on a real program of decentralization; such an argument is based on the opinion that important work can only be done in Ottawa. Such a notion is dispelled by new communication technologies, including videoconferencing, that allow far greater flexibility to all organizations.

Elsewhere, British Prime Minister Tony Blair announced in his spring budget of 2004 the relocation of 20, 000 public servants from London to the regions of the United Kingdom. In 2003, the Norwegian government announced plans to move eight state regulatory agencies outside of its capital.

Relocation is possible; all that is needed is political will.

As you probably recall, there have been moves in this direction in the past. In 1976, Jean Chrétien, then President of the Federal Treasury Board and Dan MacDonald, then Minister of Veterans Affairs, announced the relocation of the national headquarters of the Federal Department of Veterans Affairs to my home community of Charlottetown, Prince Edward Island.

Twenty eight years later, the benefits for Prince Edward Island are obvious - and highly valued. The economic benefits of relocating the Veterans Affairs headquarters to Charlottetown have been very positive. They include: 1200 full time jobs; a 68 million dollar yearly payroll; many student jobs during the summer; add a career path for future generations who want to stay in the region.

Beyond the economic contribution, the presence of Veterans Affairs has also made a significant contribution socially. The presence of Veterans Affairs has broadened Prince Edward Island society to include a vast array of highly trained professional public servants who contribute their every working day to public affairs and to Prince Edward Island society.

At a completely different level, one of the most exciting impacts of Veterans Affairs headquarters being in Charlottetown has been the remarkable growth in the use of the French language. Prince Edward Island has always had a thriving Acadian community, but the addition of Veterans Affairs deepened the role of the French language. According to Statistics Canada, after Quebec and New Brunswick, Prince Edward Islanders are third, among the provinces in their knowledge of both languages. There is no doubt that the strength of the Acadian community assisted in that regard, but, the greatest single contribution, to the growth in the French language, is the presence of Veterans Affairs.

Veterans Affairs is the only federal department with its national headquarters located outside of the Ottawa area. I believe it is now time to restart the decentralization process, and give the other regions of Canada the same opportunities, and benefits, enjoyed by Prince Edward Island over the past twenty eight years.

Sincerely,

Percy E. Downe
Senator