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Unformatted text preview: ed since the 2000 reform took 7 Commission on Fiscal Imbalance effect, according to David Collins. In fact, the Commonwealth’s share has risen 5% because the new GST, that replaced
certain taxes that states gave up and is paid in full to the states, is considered a federal tax. 3.2.2. Spending Decentralization15 In many countries, responsibilities for spending programs, and even legislative authority in some cases, are highly
decentralized or are heading in that direction.
In the case of the three oldest federations (United States, Switzerland and Australia), the federated states’ share of total
public spending and the distribution of jurisdiction over spending are fairly stable overall, with the possible exception of
the United States where the share of the states and local administrations in public spending as a whole has been on an
upswing since World War 2.
From the standpoint of the jurisdictions and responsibilities of the American states, the few notable changes concern the
greater flexibility they have received in the administration of social assistance programs (for which they receive federal
funding), within the limits and conditions set by the federal government, and the adoption of a law limiting the capacity of
the federal government to impose unfunded mandates on states. However, as Bill Fox and Bruce Wallin point out, these
changes are somewhat limited in scope.
In Switzerland, the shares have been fairly stable for 30 years for the three categories of government: 31-33% for the
Confederation, 39-40% for the cantons and 27-29% for the communes. The distribution of jurisdictions is strongly
influenced by the application of the subsidiarity principle and has not fundamentally changed in 30 years. The cantons
and communes account for two thirds of public spending and they predominate in the education, health, public order,
culture and environmental sectors. However, in the social affairs sector, as a general rule, Bernard Dafflon notes a slight
trend towards centralization (federal legislative control rising slightly with a concomitant increase in the execution role of
Lastly, in Australia, the proportions were also stable during the 1990s, the Commonwealth being responsible for 56-58%
of spending and the other governments accounting for 42-44%. David Collins points out that the 2000 reform did not
alter the distribution of jurisdictions.
In the case of Belgium, the decentralization process that started a number of decades ago and marked among other
things by the 1993 federalization continues today. The latest institutional agreements, in particular the so-called “SaintPolycarpe” Agreement in 2001, again increased the jurisdictions of the Regions. The federated entities (Communities
and Regions) account for a growing share of overall spending, though federal predominance is still substantial,
attributable to a large extent to the fact that social security remains within federal jurisdiction. The largest spending
items of the Regions and Communities are, respectively, e...
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