The Impact of a Restructured Canadian Welfare State on Atlantic Canada

The Canadian welfare state, like welfare states elsewhere, has undergone significant reform and restructuring. This paper examines what has occurred and the impact it has had on Canada’s poorest and most underdeveloped region, the Atlantic provinces of Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland. Although the central and western regions have also experienced a reduction in federal expenditures, no other region has been more negatively affected by federal fiscal and social policy reform and downsizing. Health care and education have experienced the worst cuts. The significant loss of federal government transfers to this region has ruptured a historic social contract. This in turn has triggered a radical restructuring and downsizing of provincial and municipal public administrations, commensurate with job losses in important sectors of the labour market, such as universities, hospitals and schools. In the last five years the rate of unemployment and poverty has risen sharply, personal and household incomes have declined, and entire communities are on the brink of extinction owing to out‐migration. The irony, however, is that for Atlantic Canadians the retrenchment of the federal state has led to greater public willingness to consider social democratic political parties and policy alternatives that are not only different from prior fare, but which do not represent a flight to a rather unsatisfactory past.