Federalism and The Reconciliation Agenda

By Catherine Waters, Director, Learning Design and Evaluation

September 10, 2025

When Canadian federalism was built, it was based on the division of powers between the federal government and the provinces; however, it left Indigenous nations outside the constitutional bargain. For too long, “consultation” and “engagement” have been the language used to describe the relationship, words that suggest listening, but not sharing authority and decision-making. At the same time, what has been evident since 1867 is that Canadian federalism is a living system rather than a fixed design. This mutability has been achieved through evolving interpretation of Sections 91 and 92 of the Constitution Act (formerly the British North America Act), financial pragmatism, national standard-setting, and changing values and visions of nationhood.

So how is Canada being reshaped by the push toward reconciliation with Canada’s Indigenous peoples? How do the issues and processes of reconciliation shape a different concept of partnership and power-sharing alongside federal and provincial governments?

Traditionally, the core dynamics of federalism have been defined by negotiations between the federal and provincial governments, often around fiscal arrangements, resource management, and social policy. Yet this binary view—federal versus provincial—has never fully captured the complexity of governance in Canada. Indigenous nations, whose political authority pre-dates Confederation, were long excluded from the federal architecture. Their voices were sidelined, their jurisdictions were ignored, and their treaty relationships often marginalized.

One of the first steps toward reconciliation with Indigenous peoples was the legal recognition of Indigenous rights in Section 35 of the Constitution Act, 1982, and subsequent Supreme Court rulings affirming inherent rights to self-government.  2015 was a significant year for the acknowledgement of Canada’s relationship with Indigenous peoples: in May 2015, Chief Justice Beverley McLachlin of Canada’s Supreme Court delivered a speech in which she made explicit reference to Canada’s cultural genocide of its Indigenous peoples. Not even a month later, in June 2015, Justice Murray Sinclair, in the release of the report of the Truth and Reconciliation Commission that explored the terrible abuses of Indigenous children in residential schools, used the phrase “cultural genocide”.  Although this is not a legally recognized term, it nonetheless stressed the shift from a paternalistic relationship to a partnership, and underlined the obligations on the Canadian federal system to broaden its scope to be a more pluralist system, rather than a dual one. Under this conception, Indigenous governments are acknowledged as distinct orders of government alongside federal and provincial authorities.

Earlier shifts in the shape of federalism were characterized by a more zero-sum contest for jurisdiction and power.  However, key initiatives, such as the adoption of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), modern treaty negotiations and land claims agreements, and the expansion of Indigenous jurisdiction in areas like child and family services, education, and natural resource management, demonstrate how reconciliation reshapes power, authority and decision-making responsibilities. These developments reconfigure power as a shared responsibility to honour nation-to-nation and government-to-government relationships.

The role of Canadian courts has been pivotal in affirming Indigenous rights. A landmark decision by the Supreme Court of Canada was Calder v. British Columbia (1973) where the existence of Aboriginal title was first recognized, setting the stage for later rulings. In Delgamuukw v. British Columbia (1997), the Court clarified that “Aboriginal title” is a constitutionally protected right under Section 35, grounded in prior occupation of the land and encompassing not just surface rights but also resources. This principle was deepened in Tsilhqot’in Nation v. British Columbia (2014), the first case to grant a declaration of Aboriginal title to a specific territory, affirming Indigenous authority to decide on land use.

Alongside land rights, the duty to consult and, where appropriate, accommodate Indigenous peoples was established in decisions like Haida Nation v. British Columbia (2004) and Mikisew Cree First Nation v. Canada (2005), requiring governments to engage with Indigenous communities before authorizing projects affecting their rights. Together, these rulings have reshaped Canadian federalism by embedding Indigenous jurisdiction and consultation duties into the legal landscape of resource development and governance.

The realities of natural resource extraction and pipelines, economic pressures as trade patterns shift, both internally between provinces and externally with international trade partners, apply new pressures on the federal system. Prime Minister Mark Carney’s government was elected on a banner of “Canada Strong”, which underlined the need for flexibility and accommodation between all levels of government to achieve nation-building goals. These pressures also lean heavily on the meaning, scope, and practices of reconciliation.

The National Day for Truth and Reconciliation, which takes place this month on September 30, is a moment to reflect on how Canada is re-examining its internal relationships. The day reminds us that reconciliation cannot be merely a symbol, but rather requires structural and policy change. For federalism, this means adapting institutions and practices to make space for Indigenous voices in policymaking, and respecting the recalibration of structure and jurisdiction that ensues.

This resonates with the essence of federalism itself and its history since 1867: a willingness to renegotiate, redistribute, and recalibrate authority in response to evolving realities. Just as provinces once fought for greater autonomy from Ottawa, Indigenous nations now assert their rightful place in Canada’s governance framework.