The very nature of Canada’s confederation provides for regional differences that can be resolved through a common desire to build a stronger, more prosperous country. Last Friday's First Ministers' meeting to discuss the Pan-Canadian Framework on Clean Growth and Climate Change was no exception.

Most notably, Saskatchewan refused to support the framework, questioning the merits of carbon pricing; British Columbia supported the framework, but tried to make the case that its carbon tax was higher than prices under a cap-and-trade system; and Manitoba did not sign it, pending a resolution to healthcare funding, but the province supports pricing carbon and taking action on climate change.

Three key questions emerged out of the First Ministers' meeting. 

1)     Would taking action on climate hurt the Canadian economy?

Climate change is already affecting, and will continue to have an impact on, our economy and environment. For example, the Prairie Climate Centre, a collaboration between the University of Winnipeg and the International Institute for Sustainable Development, projected average temperature increases in Regina and Saskatoon of about 2℃ and 4℃ by 2035 and 2065, respectively, as well as more frequent extreme weather events. The cost of increased floods, hurricanes and drought will shock local economies.

Saskatchewan questioned whether pricing carbon could affect Canada's competitiveness. It is important to remember that pricing carbon is the most cost effective approach to reducing emissions and is supported by private sector investors and industry. For example, in 2014, support for pricing carbon by 74 countries and over 1,000 companies resulted in the formation of the Carbon Pricing Leadership Coalition.

The essence of pricing carbon is based on the simple "polluter pays" principle. However, there are other ways of reducing emissions. One way is implementing regulations that are more stringent and with costs that can be passed on to consumers. The other approach is government subsidies, which transfer the cost of pollution away from the polluter to society at large.

Saskatchewan supports carbon capture and storage (CCS), which is an important tool and will likely be necessary over the long term. In the short term, governments and the private sector could invest to reduce costs of new technologies. However, there is a fundamental question about whether costs associated with commercial deployment of new technologies such as CCS should be borne by taxpayers, by the private sector, or both. Even if no government funding were provided, CCS projects would require a price on carbon to remain operational.

A price on carbon could increase the bankability of CCS projects over their lifetime. Perhaps that's not such a bad idea after all?

2)     Does reinvesting carbon revenues result in environmental benefits?

Putting a price on carbon pollution creates conditions for behavioural change that will result in a better environment. However, this is only one side of the coin. Governments generate revenue from pricing carbon pollution that they can return to their citizens, invest in measures to reduce emissions, or both.

By returning the revenues to citizens, those that change their behaviour will stand to benefit—and even receive more money than the carbon tax they pay. It is a strong incentive and it works (British Columbia is a good example of this approach).

Alternatively, by investing the money back in the local economy to reduce emissions, governments can put their province on track to reduce emissions and, subsequently, the impact of the carbon price. By recycling revenues back into the economy, governments can create jobs in clean technology and renewable energy, improve public transportation and diversify their economy. Alberta plans to implement this approach while also returning the money to its citizens.

Either way, real-life experience has demonstrated to us that recycling carbon pricing revenues works.

3)     Can prices between the carbon tax and cap-and-trade systems be compared?

British Columbia has had a revenue-neutral price on carbon since 2008 and has seen its emissions decrease while its economy grew faster than those of the rest of Canada. Its carbon tax has been frozen since 2012 and its government has held a firm position that it will not increase its price on carbon until the rest of the country catches up. It has argued that its price on carbon exceeds Ontario's and Quebec's cap-and-trade price.

Alberta will soon catch up, and likely surpass, British Columbia on carbon pricing policy. It would be delusive to directly compare a price under a carbon tax with that of cap and trade. The latter puts a declining limit on emissions, while British Columbia’s carbon tax does not. Also, the price on carbon under cap and trade is driven by market forces. The strength of a carbon tax is its predictable schedule, which allows industry to make sound longer-term investments. And finally, to meet federal requirements, Ontario and Quebec would need to reduce their cap to meet federal 2030 commitments. The two systems are different with varying requirements.

To compare apples to apples, British Columbia could, however, adopt a cap-and-trade system, and set a declining cap on its emissions. Rather than, once again, deferring a decision on increasing its carbon tax by questioning the comparability of cap and trade and carbon tax, the onus should be on the province to demonstrate how its carbon price (at current levels) would result in emission reductions that would be comparable with federal requirements for a cap-and-trade regime. In fact, since freezing its carbon tax, British Columbia's emissions have begun to rise.

Making Progress by Pricing Carbon

Canada's provincial and territorial governments would benefit from designing their own carbon pricing systems, versus one that is imposed by Ottawa. Provinces and territories can ensure that their pricing regime meets local circumstances and that revenues can be recycled to meet policy objectives.

Resisting carbon pricing on an ideological basis will make a jurisdiction less competitive as the rest of the country progresses. The next few years will be critical in developing robust policies and programs in the implementation of the framework, which are discussed here.

Over the past year, federal, provincial and territorial governments have been working together to hammer out the pan-Canadian Framework on Climate Change and Clean Growth.

Nothing is more Canadian than a collaborative approach to finding solutions to a common problem. After all, climate change will affect the entire country, and we are all in this together. If we are to meet our 2030 international climate commitments, a national framework should: recognize provincial action to date; glue together the current patchwork of policies to form a more cohesive approach; and, most importantly, raise ambition through robust set of policies and program solutions. An agreement on the pan-Canadian Framework will still require a great deal of work on policy design and implementation, which is expected to be completed over the coming years.

Quebec has taken steps to address its greenhouse gas emissions, most notably through the implementation of a cap-and-trade mechanism. This is definitely a step in the right direction in addressing climate change.

However, as long as fossil fuel subsidies and other financial supports exist, they will continue to challenge efforts to reduce emissions in Quebec as well as meeting Canada’s G7 subsidy elimination target. This commentary takes a very preliminary look at consumer fossil fuel subsidies in Quebec. Our initial research identifies roughly CAD 270 million in 2015 in the form of financial supports for the consumption of fossil fuels.

The supports for fossil fuel use identified here are a good place to start to look at reforms. They are not the only supports in place, and we also suggest increased transparency on the foregone revenue represented by the additional, unquantified items. Subsidy reform should be bundled with other policies that help affected industries and workers to adjust. Here, the federal government will need to work closely with the provinces, including Quebec.

The 2030 Agenda sets out an “ambitious vision of the future,” tackling critical challenges that are important for Canadians.

These include reducing poverty and inequality, protecting biodiversity and water resources, building green infrastructure and making our production and consumption patterns more sustainable.

Implementing the 2030 Agenda entails an equally ambitious vision for governance systems (such as coordination across departments, integrated strategy development and tracking progress) so that they better integrate economic, environmental and social factors into decision making.

Many developed and developing countries already recognize the SDGs as a clear opportunity for generating greater coherence in government policy to advance long-term sustainability. This is evidenced by the fact that 22 countries had already voluntarily reported on progress toward implementation by the end of the first year of the SDGs.

Finland, for example, decided to put SDG implementation under the direct responsibility of the Prime Minister’s Office and has already developed a baseline and targets for the country’s SDG implementation efforts. China has developed its implementation strategy and assigned SDGs to specific departments connected through a coordinate mechanism. In its report to the UN’s High-Level Political Forum, Switzerland outlined a two-year strategy to prepare for implementation with actions such as multistakeholder consultations, clarifying institutional arrangements and conducting a baseline study and gap analysis to identify future areas of action to implement the 2030 Agenda. In addition, the German Council for Sustainable Development (RNE) submitted its statement on “Germany’s Sustainability Architecture and the SDGs” to the federal government outlining implementation efforts (RNE, 2015).

Canada, home to IISD’s headquarters, has yet to clearly articulate what its federal government’s leadership on the 2030 Agenda will look like. So far, all we have seen are mentions of the SDGs in speeches by Prime Minister Trudeau and references to a limited number of SDGs in the new Federal Sustainable Development Strategy for 2016–2019.

So what can Canada do to take the 2030 Agenda seriously and show specific actions on SDG implementation?

• First, following the example of other countries, Prime Minister Trudeau should take leadership for SDG implementation under his Office and develop a process for effective interministerial coordination. This needs to happen in order to integrate the government’s social, economic and environmental policies into a coherent approach, in the true spirit of the 2030 Agenda.
• Second, Canada should establish a multistakeholder National Round Table or Commission to engage Canadians with solutions to sustainable development issues and approaches to implementing the SDGs.
• Third, Canada should expand the current Canadian Environmental Sustainability Indicators to a comprehensive set of national sustainable development indicators that reflect economic, social and environmental issues and thus enable a sound method for consistent measurement of progress toward the SDGs. This can then be used to create Canada’s own baseline and begin reporting on progress with SDGs to the UN HLPF.

Finally, when implementing these steps, we need to pay close attention to the inequality and well-being challenges that exist for many First Nations peoples in Canada. For example, while the average per capita income of Canadians is approximately $77,000 a year, for Canada’s Inuit population it is $17,000 a year. The SDGs make several references to First Nations peoples, including SDG 2, which relates to food, and SDG 4 regarding access to education. The recommendations of the historic Truth and Reconciliation Commission (TGC) report should be cross-referenced with the suite of targets in the SDGs, beginning with the overarching recommendation that the United Nations Declaration on the Rights of Indigenous Peoples be the framework for reconciliation (TRC 43). With regards to SDG 3 on health and well-being for all, at every stage of life, the TRC report recommends “measurable goals to identify and close the gaps in health outcomes between Aboriginal and non-Aboriginal communities,” including indicators such as infant mortality, maternal health, suicide, mental health, addictions, life expectancy, birth rates, chronic diseases and the availability of appropriate health services.

To successfully implement the SDGs in Canada, we need to focus on developing a national SDG strategy, conducting consultations and selecting indicators so that the deep-rooted challenges of Canada’s First Nations peoples are recognized and can become an integral part of the strategy and the monitoring framework. 

All eyes were on the United Nations two weeks ago as Prime Minister Justin Trudeau made his inaugural speech to the General Assembly.

The speech was forward-looking, laying out a hopeful and ambitious case for building inclusive and diverse societies, and recognizing that Canadians are unavoidably affected by and linked to “what happens beyond our borders.”

The federal government now needs a framework and an action plan to implement its vision for Canada and the world.

Fortunately, a global framework such as this already exists: the Sustainable Development Goals.

Last week marked the first anniversary of when world leaders at the UN adopted Transforming our World: the 2030 Agenda for Sustainable Development, an agenda that lays out 17 Sustainable Development Goals (SDGs) for all countries—including Canada—to end global poverty and other pressing challenges.

Agenda 2030 represents a comprehensive and integrated approach to sustainable development. It looks to tackle many of the issues the prime minister identified in his speech: education and infrastructure, building a fair and inclusive economy, tackling inequality and climate change, and addressing the rights and needs of women and Canada’s Indigenous peoples, among others.

Many other countries have recognized that the SDGs represent a clear opportunity for generating greater coherence in government policy around issues of society, economy, and environment, and they are using the framework to shape their future policies. At the UN High-Level Political Forum on Sustainable Development last July, 22 countries voluntarily reported on progress towards implementing the SDGs.

Colombia has established a multistakeholder high-level commission to implement the 2030 Agenda, which reports to the president and works with civil society, the private sector, and local government on implementation.

China and Norway have assigned the 17 goals to specific departments and established a mechanism to coordinate efforts. In Switzerland, the cabinet has developed a multi-sector, multistakeholder, cross-ministerial strategy to implement the goals.

Germany has gone one step further, revising its National Sustainability Strategy to integrate all 17 SDGs, requiring all line ministries to align with and report against this overarching strategy to the German chancellery. Finland’s whole-of-society approach is similarly led by a National Commission on Sustainable Development housed in the prime minister’s office.

In Canada, however, we have yet to see high-level leadership on this issue. Though there have been welcome references to the SDGs in speeches by the prime minister and in documents for consultations on the Federal Sustainable Development Strategy and the International Assistance Review, there have yet to be clear, concrete, and bold steps to advance the SDGs within Canada.

The SDGs provide a compelling framework in which to shape Canada’s ambitious domestic and international agenda, including creating genuine partnerships with Indigenous communities, more actively engaging the provinces and municipalities, advancing social justice and gender equality, and ramping up low carbon pathways. So what can Canada do to improve its policy alignment in this area, and seize the opportunity to use the SDGs to advance its policy objectives on the domestic and global stage?

First, this fall Prime Minister Trudeau should establish an interministerial committee on the SDGs reporting directly to him. This can help better integrate the government’s social, economic, and environmental policies into a coherent approach to sustainable development both at home and abroad. The outcome of the International Assistance Review and the new sustainable development strategy, to be released in October, can be starting points for discussions, moving well beyond just issues of aid and environment to an approach that is fully inclusive of society and economy.

Second, Canada should establish a multistakeholder national roundtable or commission to engage Canadians around solutions to sustainable development and foster a whole-of-society approach to implementing the SDGs. This must actively engage with the three levels of government, Indigenous authorities, civil society, the private sector, and Canadians on implementing the SDGs both in Canada and overseas.

Third, Canada should volunteer to appear before the next meeting of the High-Level Political Forum in 2017 and present a voluntary national review that will indicate how it is implementing Agenda 2030.

Finally, to commemorate Canada’s 150th anniversary, the prime minister should announce an SDG action plan that matches the ambition of his vision and forges a new global path for Canada—one that is led by a whole-of-Canada approach to “transforming our world.”

The prime minister, including in his role as youth minister, has set a new course in building a more inclusive and sustainable Canada for current and future generations. Substantively embracing and implementing the SDGs will be a significant and lasting contribution to Canada’s own sustainable development, as well as helping to build a better world.

This article was originally posted on The Hill Times website on October 5, 2016, and is reprinted here with permission.

Oil, gas and coal are multi-billion-dollar industries, and every year fossil fuel companies get billions in tax breaks and handouts that increase their profits even further.

In a world that’s shifting to clean energy, many of these subsidies don’t make sense, and they undermine climate change action. But taxes and subsidies are complicated. We designed this website to cut through the jargon, so you can understand what’s really happening, debate it, and propose solutions for Canadians and Canada’s economy.