Federalism, Subsidiarity and the Economic Vision of Canada’s Constitution

The solution may be to establish an institution designed to tackle the inability of governments to coordinate regulatory reform on their own.

December 11, 2025

in Domestic PolicyLatest NewsIntergovernmental AffairsMultimediaVideoEconomic PolicyPodcastsMark ManciniPeter Copeland

Reading Time: 1 min read

Mark Mancini and Paul Daly argue that our constitutional and legal landscape makes the path to greater economic union much harder than people think.

Federal unilateralism is largely off the table. The Charter offers no real help. And decentralized regulatory power means friction is almost built into the system.

Recent federal and provincial moves toward greater economic collaboration through mutual recognition are a good start, but how far can they go, and do they have staying power?

We unpacked how far federal leadership can go, where provincial autonomy must be respected, and whether a joint federal-provincial agency — built through inter-delegation — could provide the teeth and structures needed to achieve greater economic integration.

Description:

Canada’s economic future increasingly hinges on a deceptively simple question: how free is trade within Canada itself?

For decades, economists and policymakers have warned that Canada’s internal market—fragmented by duplicative rules, sector-specific carve-outs, and a thicket of provincial exceptions—acts as a drag on growth and competitiveness. Even the Canadian Free Trade Agreement, heralded as a breakthrough, is riddled with loopholes.

To dig deeper, Inside Policy Talks brings together legal scholar Paul Daly and MLI senior fellow Mark Mancini for a conversation with Peter Copeland, MLI’s deputy director of domestic policy.

Daly explains the central irony: removing regulatory barriers requires a mechanism with real authority to do it. Without a body empowered by both Parliament and the provinces, “what you’re going to get is what we have, which is a mosaic of different provisions.” Canada needs a national coordinating agency with the power to set standards, enforce mutual recognition, harmonize where necessary, and “raise [barriers] to the ground,” as Daly puts it.

Mancini agrees, stressing that skepticism toward new agencies is understandable—but the status quo simply cannot solve the problem. This wouldn’t be “an agency for the sake of an agency,” but an institution designed to tackle a precise challenge: the inability of governments to coordinate regulatory reform on their own. With nationwide buy-in, such a body could finally move Canada beyond one-off bilateral deals toward a genuinely integrated economic union.

Together, Daly and Mancini make the case that fixing Canada’s internal trade system is not a technocratic curiosity—it’s a national economic imperative.

Spotify and Apple podcast

Leave a comment