Why did the CCF fail? A Swedish Answer

Patrik Marier

Canada Research Chair in Comparative Public Policy

Department of Political Science

Concordia University

Paper Presented to the 8th Biennial ECSA-C Conference, April 29-May 1st 2010

April 22, 2010

Introduction

In his study of Sweden, the poster child of comparative welfare state development, Rothstein (1996)

claims that power resource analyses (Stephens, 1986, Korpi, 1983, Esping-Andersen, 1985), focused

primarily on the combined power of unions and social democratic parties to counter the power of

capital, neglect the multiple difficulties associated with the implementation of a socialist program once

in power. Winning an election is the first step in a long journey within the policy making process; key is

the ability of the governing party to have its policy goals implemented by the civil service, which is

daunting task. Controlling and/or capturing the state machinery remain highly difficult for any

government (Rothstein, 1996: 8), but more particularly for parties who seek a “radical” departure from

earlier practices such as socialist parties (Lipset, 1950).1 Actually, German thinkers such as Weber and

Michels feared that the bureaucracy would eventually capture the social democratic parties (Michels,

1999, Beetham, 1985).

This contribution aims to identify the necessary conditions for a government to alter the values of

the bureaucracy and to present and test three hypotheses on what can lead to a reversal. This is

facilitated by the analysis of a negative case, one in which hegemonic dominance by a social democratic

party did not result in the creation of a socialist or social democratic state in spite of a radical

transformation of the bureaucracy. This case is Saskatchewan, which is a province in Canada. It is

analysed and compared to the Swedish case, which represents a positive case of bureaucratic capture

(Rothstein, 1996) despite representing a most similar case.

The election of the Co-operative Commonwealth Federation (CCF) government in 1944, the first

socialist government in North America, gathered substantial interest among academics for decades

(Johnson, 2004, Lipset, 1950, Young, 1969, Whitehorn, 1992, McLeod and McLeod, 2004). For example,

Lipset’s study of Saskatchewan formed the basis of his reflections on “American exceptionalism” when it

comes to the absence of a strong left wing party in his country (Lipset, 1983). Like its Swedish

counterpart, the Social Democratic Party (SAP), the CCF succeeded in creating a broad based coalition

that included agrarian interests; a consequence of the predominance of agriculture and the late

1 By radical, the authors imply the introduction of policies and programs that are contrary to those currently advocated by the bureaucracy, which represent, to a large extent in the early 1900s, the ideals advocated by Liberal and Conservative governments. The defeat of a Liberal government by a Conservative one, or vice versa, did not challenge the views held by the bureaucracy.

industrialization of the province.2 The Premier, Tommy Douglas, was fully aware of the bureaucratic

hurdle. He was reported as saying that: "No matter how good legislation is, if those in charge of

administering it are unsympathetic or incapable of a new approach, little good will come of it" (cited

from Brownstone, 1971: 5). Like Sweden, the CCF devoted a lot of energy into the creation of a

bureaucratic apparatus to implement their ideas. As such, it actually went further than Sweden, which

targeted departments that were deemed important to establish core demands from union supporters at

the time (Rothstein, 1996), by creating a host of institutions at the executive level to facilitate planning.

Many of these ideas and practices would later be implemented in other provinces and in Ottawa (Dunn,

1995).

The similarities with Sweden do not end there. The CCF is renowned for having introduced multiple

innovative social policies and programs, many of which would later be adopted by other provinces and

the federal government. These include the introduction of universal health care, a compulsory public no

fault automobile insurance place, trade union legislations and Canada’s first Bill of Rights (Johnson,

2004: 66). The first CCF government (1944-1964) “is now regarded as Canada’s most socially innovative

government of the twentieth century” (Marchildon, 2004 :xvi). In addition, like the SAP, the CCF/NDP3

would become a hegemonic party having ruled Saskatchewan for 47 out of 65 years between 1944 and

2009.

Herein lies the puzzle: contrary to Sweden, the hegemonic power of the CCF/NDP did not result in

the entrenchment of the most generous welfare state in Canada despite the development of a

bureaucracy tailor-made to achieve these objectives. This outcome is explained by the actions taken by

the Devine governments (1982-1991) to alter this legacy. Specifically, it succeeded in eliminating the

bureaucracy as a source of policy influence and in reducing substantially the source of funding for

current and future social programs. Subsequent NDP governments have been unable to re-establish a

distinctive socialist agenda and the capacity of the civil service to make it possible. The bureaucracy is no

2 The CCF succeeded in integrating agrarian interest within its own party while the SAP formed a parliamentary coalition WEIR, M. & SKOCPOL, T. 1985. State Structures and the Possibilities for Keynesian Responses to the Great Depression in Sweden, Britain, and the United States. In: EVANS, P. B. (ed.) Bringing the State Back In. Cambridge: Cambridge University Press , ESPING-ANDERSEN, G. 1985. Politics Against Markets: The Social Democratic Road to Power., Princeton, Princeton University Press.. 3 The CCF changed its name to the New Democratic Party in 1961. This occurred as a result of a merger with other leftist parties at the Federal level. After the 1967 elections, the provincial authorities in Saskatchewan adopted this name as well.

longer considered to be a source of policy innovation (Rasmussen, 2001) and a group of authors even

claim that the NDP has moved firmly to the right by adopting neo-conservative policies (Brown et al.,

1999) while a more optimistic account claims that the NDP has embraced the third way (McGrane,

2007).

This contribution presents a critical assessment of the bureaucratic thesis, inspired by the work of

Rothstein (1996), and it is divided into four sections. First, the role of the bureaucracy in the expansion

of the welfare state and the ways in which a government can create a left-wing bias are analysed.

Second, a brief description of the rise of the CCF and its impact on public administration is introduced

followed by an analysis on its influence in the development of the Saskatchewan welfare state. Third,

based on the evidence that the province seized to be a generous welfare state leader by the end of the

Devine mandate in 1991 and by the end of four consecutive NDP mandates ending in 2007, three

explanations are introduced to address this puzzling outcome in light of the Swedish experience. Fourth,

the conclusion assesses the evidence and discusses the limitation of the bureaucratic power thesis.

The Bureaucracy: An understudied element in welfare state research.

As a result of its generous welfare state, Sweden is often used as a key case, if not the benchmark, in

comparative analysis (Korpi, 1983, Bonoli, 2007, Esping-Andersen, 1990, Baldwin, 1990). Researchers

have focused on explaining the causal relationship resulting in the Swedish outcome with the hopes of

also determining why others countries failed to achieve a similar result. For example, it is with the

Swedish experience in mind that the power resource school argues that the road to a generous welfare

state requires a strong union/social democratic nexus (Stephens, 1986, Korpi, 1983, Esping-Andersen,

1985).

While these studies have generated a wealth of insightful comparative contributions, few have

integrated the bureaucratic thesis within their analysis (but see Weir and Skocpol, 1985, Heclo, 1974,

Rothstein, 1996, Lindqvist, 1990, Rueschemeyer and Skocpol, 1996).4 Beyond the expert knowledge of

civil servants, their tenure results in a thorough understanding of policies and programs within their

departmental unit and in a propensity to learn from previous policy experiences (Lindblom, 1959). With

these assets, bureaucrats have performed the role of innovative policy makers (Heclo, 1974, Derthick,

1979, Peters, 1995, Campbell and Szablowski, 1979) and they have also played a vital role in

4 Its dismissal is often related to a lack of concepts that could be quantifiable. Thus, it is easier to discuss the role of the state by analyzing veto players and veto points and ignore the organization of the civil service.

implementing and adapting social policies on the ground (Lipsky, 1980, Pressman and Wildavsky, 1984).

Nonetheless, the role and importance of bureaucrats continue to be understated in the political science

literature (Meier and O'Toole Jr., 2006a). This is particularly true of the current literature on the

retrenchment of the welfare state where bureaucrats have vanished (Marier, 2005).

The public administration is far from being neutral in the various phases of the policy process. In

some extreme cases reminiscent of the popular TV series Yes, Minister, bureaucrats have sought to

ignore openly the wishes of new ministers by running their department as they saw fit. Probably the

most famous episode related to the Minister of Finance, the German Social Democrat Rudolf Hilferding,

who suffered a nervous breakdown while attempting to oppose his bureaucrats (Beetham, 1985).

Within the formulation of policy, the options presented by civil servants tend to be limited and reflect

clearly the preferences of their department (Peters, 2001). This is accentuated by the increasing

specialisation of civil servants. Already in the mid 1950s, Titmuss (1958) feared that the increasing

specialization and knowledge utilized to provide social services would result in a privileged position

within the policy making for occupational groups involved in their delivery (27).

Within countries where ministers cannot rely on an extensive political staff, as in the Westminster

model, it is extremely difficult for a new minister to challenge them (Macdonald, 1991), which is

fundamental considering that the presence of a new minister is the rule rather than the exception in

parliamentary democracies. Ministers are often replaced even when the government is very stable

(Huber and Martinez-Gallardo, 2008). For example, in the UK, the average tenure for a Minister is 26.9

months (Berlinski et al., 2007). Entrepreneurial politicians who choose to engage in debates with civil

servants, do so despite the fact that the later possess key advantages such as a thorough understanding

of the techniques and tools utilized to assess policies and programs (Peters, 2001).

The case for bureaucratic power is even more obvious in the implementation stage. The higher the

number of individuals involved in the implementation of a policy, the less likely are the wishes of

politicians being fulfilled (Pressman and Wildavsky, 1984). Moreover, multiple social services provided

by civil servants involve a lot of discretion, which can result in power being vested in street-level

bureaucrats (Lipsky, 1980). The introduction of substantial policy and administrative change is

particularly challenging when it requires the cooperation from SLBs (McDermott, 2006, Brodkin, 1997).5

5 It is important to note that the difficulty of controlling the bureaucracy has not only been faced by left wing parties. The conservative bias of the bureaucracy also challenges parties on the right side of the political spectrum.

Bureaucratic “capture” by socialist governments and its impact on social policies

What conditions facilitate the “capture” of the bureaucracy and enhance strongly the likelihood that

the policy agenda of a socialist government (or any other government that is ideologically opposed to

the prevailing values of the civil service) will be implemented? The control of the bureaucracy is a mean

to an end, albeit a crucial one, with the enactment of socialist policies as the primary objective

(Rothstein, 1996). While there is a body of literature that emphasises the importance of the

organizational structure and its impact on policy (Egeberg, 1999, Gulick, 1937, Whitford, 2002), this is

not sufficient to create long lasting changes in the political orientation of policies since it ignores the

importance of the values of the bureaucracy (Meier and O'Toole Jr., 2006a, Meier and O'Toole Jr.,

2006b). A profound transformation and re-organization of the civil service, to alter policies in line with

the agenda of the governing party, must be done in concert to change their values and organizational

culture.

The bureaucracy is unlikely to change its way of thinking and operation when facing a new

government. Actually, there is a lot of evidence suggesting that newly elected governments are prime

candidate to be captured by the bureaucracy. It is within these circumstances that most complaints

about the partisan nature of the bureaucracy are often heard. For example, the Swedish right-wing

coalition was highly critical of the bureaucracy once it took power in 1976 and in 1991 claiming that it

opposed both the reassessment of previous policies and change (Pierre, 1995). Canadian accounts

reveal a similar level of frustration by the Conservatives who criticised the bureaucracy of being biased

in favour of the Liberals. Diefenbaker, a Conservative who became Prime Minister after a 22 year Liberal

rule, even referred to senior civil servants in the Department of Foreign Affairs as “Pearsonalities” in

For example, contrary to the CCF in Saskatchewan, the right wing government W. R. Bennett in British Columbia established and/or strengthened central agencies, cabinet committees, and central department to facilitate the implementation of austerity measures DUNN, C. 1995. The institutionalized cabinet: governing the Western Provinces, Montreal, McGill Queens University Press.. In the UK, the introduction of New Public Management by Thatcher was caused partly by the belief that bureaucrats had gained too much power at the expense of political executives AUCOIN, P. 1990. Administrative Reform in Public Management: Paradigms, Principles, Paradoxes and Pendulums. Governance, 3, 115-137.. There is a strong consensus among academics that the changed she introduced in the public administration have been considerable relative to other industrialized countries SAINT-MARTIN, D. 2000. The New Managerialism and the Policy Influence of Consultants in Government: An Historical-Institutionalist Analysis of Britain, Canada and France. Governance, 11, 319-356, SAVOIE, D. J. 1994. Thatcher, Reagan, Mulroney : in search of a new bureaucracy, Pittsburgh, University of Pittsburgh Press, POLLITT, C. & BOUCKAERT, G. 2004. Public management reform: a comparative analysis, New York, Oxford University Press..

reference to the previous Prime Minister, Lester B. Pearson (Hilliker, 1984). Recently, one of the first

actions taken by the new Japanese Prime Minister was to introduce a new central agency, the National

Strategy Bureau, to curb the power of bureaucrats with claims that they are strongly attached to the

LDP the party who ruled Japan since the end of World War II (Reuters, September 16 2009). It is

therefore not surprising that Lipset (1950), based on an analysis of the first five years of the CCF in

power, concludes that relatively little had changed with regards to the bureaucracy.

There is one important lesson from all the cases presented above. In order to facilitate the

transformation of a bureaucracy, the party in power must hold the reign of government over a long

uninterrupted period because it is very difficult to alter the deeply embedded values and culture of

departments and agencies within bureaucracies. As such, one party must be hegemonic or dominant by

winning consecutive elections. In addition, as stressed by Rothstein (1996), the governing party must

devote a lot of energy to achieving the task of transforming the bureaucracy. Otherwise, it will continue

to exhibit the same bias regardless of the policy preference of the government. The strength and power

of the CCF/NDP bureaucracy stems from cumulative actions undertaken by successive CCF governments

(1944-1964), which were enhanced by the NDP in the period 1971-1982.

The Rise and Fall of the Saskatchewan Bureaucracy as the Engine of Policy Making – The Creation of

the CCF/NDP Bureaucracy

The Liberal Party dominated provincial politics following the entry of Saskatchewan into the Canadian

federation in 1905 until World War II. The public service was primarily utilized as a tool of patronage.

The centre of activity remained with the Highway department where the Minister tended to be in

charge of party organization and the distribution of favours. At the local level, highway inspectors were

the eyes and ears of the party. “The alacrity with which such appointments were made reflected both

low esteem for the public service and strong conviction that party supporters deserved recognition”

(Smith, 1975: 29). Partisan appointments to the civil service were challenged by a Liberal Premier in the

early 1920s (Martin) and by the creation of a Public Service Commission (PSC) during the Cooperative

government, where a coalition of Progressives, Independents, and Conservatives ruled the province for

one mandate (1929-1934) (ibid, McLaren, 1998: 67-90). However, following the election of the Liberals

in 1934, the Premier replaced the PSC with a single commissioner, dismissed individuals appointed by

the previous government and patronage practices were re-introduced vigorously (Smith, 1975: 201,

Johnson, 2004: 6).

The election of the CCF government headed by Tommy Douglas in 1944, the first socialist

government in North America, had a profound impact on Saskatchewan. The party, which originated

from a coalition between labour and an agrarian social movement, gained momentum in the 1930s with

the deteriorating conditions of farmers in what would eventually be called the “dirty thirties” (Lipset,

1950). Moreover, federal policies accentuated the hardship on the farmers. While the price of wheat

was highly volatile and dependent on world market, the price of equipment remained stable and

artificially inflated due to high tariffs on such goods (Eisler, 2006).6 Core CCF beliefs were spelled out

clearly in the so-called Regina Manifesto. It included popular propositions such as the introduction of

state health insurance, public pension plans, and an expansion of crown corporations, but it also

included more radical elements such as the eradication of capitalism and socialised planning (McLeod

and McLeod, 2004: 60-1, Praud and McQuarrie, 2001: 145-6). Following defeats to the Liberals in the

1934 and 1938 elections, alterations to the CCF platform were made. For example, references to

socialism and the nationalization of the land were omitted from the CCF program to mitigate Liberal

attacks and more emphasis was placed onto social security (Lipset, 1950: 151, Smith, 1975: 233).

Prior to the 1944 election, extensive planning was undertaken to present a strong platform to the

electorates. As stated by Johnson (2004), “(t)he planning was done almost as if the participants had

already formed the government” (37). In light of the dismissal of the Civil Service Commission and the

patronage practices of the Liberals, the question of the bureaucracy was front and center in the

development of a governmental strategy. Moreover, CCF guidebooks on economic theory made it clear

already in 1936 that “more concentration of power in the cabinet and the bureaucracy was unavoidable

in the socialist state” (McLeod and McLeod, 2004: 162, Brownstone, 1971) and a central planning

agency responsible to the Cabinet and the Premier was necessary to plan the economic development of

the province (Johnson, 2004: 56). Other evidence suggests that the increasing activities undertaken by

the government during World War II combined with the creation of multiple Crown Corporations also

resulted in the need for a central agency (Dunn, 1995: 27-8).

6 Based on the evidence presented at the Rowell-Sirois Commission, Saskatchewan benefited the least among Canadian provinces from the tariff subsidies. While Ontario received close to $65 per capita, individuals in Saskatchewan obtained $0.55 (Eisler, 2006: 78).

Contrary to the expectation of many CCF members and supporters, the Douglas government did not

engage in a drastic transformation of the civil service immediately after the CCF victory even though it

was filled with individuals appointed by the Liberal Party on a patronage basis. With the exception of the

Minister of Natural Resources, who laid off fifteen individuals, “(m)ost other ministers kept their staffs

almost intact” (McLeod and McLeod, 2004: 164). Even in the case of newly created departments, such as

Labour and Social Welfare (both first in Canada), three of the four deputy ministers nominated were

directors in another department and, therefore, previously affiliated to the former Liberal government

(ibid). This inaction on the part of the government fuelled strong criticism from the CCF grassroots with

the introduction of multiple motions at congresses to fire Liberal supporters in favour of CCF

sympathizers or proven socialists (Lipset, 1950: 255-7). However, the decision to retain many senior civil

servants was hardly surprising: not a single member of the cabinet had been involved in any government

prior to their election in 1944. Thus, cabinet members were in dire needs of civil servants – regardless of

their political stripes - who could guide them immediately upon taking the reins of government.

These accounts, based mostly on evidence collected shortly after the electoral victory of 1944, fail to

acknowledge the daunting task faced by the CCF government and the long-term impact of key measures

such as the creation of the Economic Advisory Planning Board (EAPB) and the recruitment of trained

professional civil servants from outside the province with George Cadbury, recruited from the Labour

Party in the UK to build the EAPB, being the most notable. The bureaucracy inherited by the government

was ill-equipped to tackle most routine functions. There was simply no governmental machinery

coordinating the activities of individual department and no budgetary machinery either. The first priority

was the rapid introduction of new policies, but it was quickly followed by a focus on organizational

matters in the second part of the mandate (Johnson, 2004: 103) with a Premier, Tommy Douglas

“determined to lead Saskatchewan into the big leagues of public administration” (McLeod and McLeod,

2004: 163).

The cumulative actions taken by the CCF during the course of their consecutive mandates (1944-

1964) resulted in a fundamental alteration of the bureaucratic structure and a de facto replacement of

the civil service (Brownstone, 1971: 66). Beyond the EAPB, the creation of the Budget Bureau to

facilitate the budgetary process while considering future endeavours and the Government Financial

Office, with the primary function of overseeing the Crown corporations, led to the development of a

strong expertise at the center of government. In his account of the Liberal Party in opposition, Smith

(1975) states that none of the social and political innovations compares to the “administrative

revolution” that accompanied the new CCF government (257-8).

By the time the CCF lost an election, in 1964, the bureaucratic structure had shifted from an unaided

cabinet, in which there is little coordination across departments and overall planning, to an

institutionalized cabinet where horizontal coordination took place (Dunn, 1995). This infrastructure

remained largely in place during the Thatcher years (1964-71), albeit far less utilized. However, as stated

by Rasmussen and Marchildon (2005), “the planning tradition was entrenched deeply enough in the civil

service that it readily sprang back into action upon the re-elections of NDP administrations” (187). This

was probably facilitated by the creation of planning units and policy expertise within individual

ministers, which was a key achievement of the CCF during its last ten years in power (Johnson, 2004).

Thus, the election of Allan Blakeney as Premier in 1971 with the planning tradition of the bureaucracy

intact sparked another 9 years of policy innovations spearheaded by an active civil service (Glor, 1997).

As stated clearly by Michelmann and Steeves (1985), “The civil service...especially at the highest level,

was a corps of officials conscious of their role, proud of their achievements and generally in agreement

with the activist philosophy of the NDP” (4).

What are socialist policies?

It is primordial to define the variable “socialist policies” to assess the extent to which a socialist

government succeeded in defeating the conservative bias of the bureaucracy. Socialist parties such as

Labour in the UK, the Social Democrats in Sweden, and the CCF/NDP in Saskatchewan originally

proposed solutions to eradicate capitalism. These typically involved the control of the economy, often

via the nationalisation of enterprises, planning, and a predominant role for the state. In all these cases,

many of these ambitions were abandoned early once in office. Entire economies were not nationalised

and the capitalist system was not reformed drastically. In Saskatchewan, the control of the economy

was quickly dismissed in the 1930s following electoral defeats and the acknowledgement that this would

not be feasible by a small province within a federation that sets core fiscal and monetary policies.

The failure to achieve these objectives should not mask socialist efforts to expand and develop the

welfare state; the establishment of a generous and universal welfare state, such as Sweden’s, represents

a significant shift from the previous laissez-faire policies of the early 20th century (Esping-Andersen,

1985, Stephens, 1986, Korpi, 1983). In order to assess the extent to which similar changes occurred in

Saskatchewan, few caveats are in order. Due to its status as a province, Saskatchewan does not have the

same ability as a country to introduce socialist policies; the federal government has the power of the

purse and it is also responsible for unemployment insurance and public pensions following lengthy

negotiations with the provinces (Banting, 1987, Simeon, 2006). Nonetheless, Canada remains the most

decentralised country within the OECD (Dion, 1992) and provinces continue to have the primary

responsibility for social policies. In addition, provinces have multiple tools to raise their revenues to

finance new policy initiatives. Therefore, if the CCF/NDP succeeded in capturing the bureaucracy in ways

akin to the Swedish Social Democrats we would expect the province to have, at least, the most generous

welfare state within the country since no other left wing party was this successful over such a lengthy

period of time and recognised for having transformed the provincial bureaucracy. With these

restrictions in mind, three key elements of socialist policies are scrutinised in this contributions: 1)

labour rights, 2) public enterprises, and 3) social policy.

First, the introduction of legislation facilitating the creation of unions and minimum labour standards

has been a cornerstone of socialist demands. Without the ability to form a union and expand

membership, there would be no potent partnership between unions and socialist parties as theorised by

the power resource theory. In addition, within the Canadian context union regulations matter greatly

since unemployment insurance is managed by the federal government. As a result, unions cannot utilise

the Ghent system to increase their appeal. However, the expansion of collective bargaining makes it

more difficult for employers to fire employees, acting as a protective measure against unemployment. In

accordance with expectations, the CCF was very active on this front. It enacted multiple legislations in

labour affairs and created a Department of Labour to ensure their implementation (Government of

Saskatchewan, 1944). In fact, one of the first bills adopted was the Trade Union Act in 1944. This bill had

overarching consequences. It allowed employees to organize and form a union of their choice and

instituted collective bargaining. In addition, it placed restrictions on employers such as the use of lock

out during any deliberation concerning them by the Labour Relations Board (Johnson, 2004: 81-2).7

Interestingly, civil servants were also allowed to form a union in 1944 (Frankel, 1960). Indicative of the

CCF’s willingness to implement its policies in spite of very different practices in the rest of the country,

federal civil servants obtained the right to form a union in 1967 (McLaren, 1998: 89). Other labour

7 Indicative of its commitment to the respect of this new legislation, the government expropriated a box factory that refused to address complaints of unfair labour practices brought up by a recently formed union in 1945 (Johnson 2004: 83).

legislation included a mandatory two-week vacation and a forty-four work week. New membership

within the Minimum Wage Board also led to a significant increase in minimum wages. The floor was

raised from $8 to $16 per week (Johnson, 2004: 82).

Moreover, a second spurt of labour reforms is associated with the Blakeney years (1971-1982). The

Saskatchewan government continued to innovate by being the first province to introduce measures such

as maternity and paternity leave (albeit unpaid), provisions for equal pay for equal work, and an

occupational health law allowing workers to refuse to perform tasks they deem too dangerous (Snyder,

1997). In the later case, this rights-based approach was more developed in Scandinavia and it

represented a first in North America (Sass, 1997). Reminiscent of similar achievements in Sweden, an

attempt to increase the power of workers within management boards were also studied by civil

servants, but these were abandoned following the sceptical reception it faced from unions (Snyder,

1997: 145). Akin to the types of program needed to tackle ‘new’ social risks (Taylor-Gooby, 2004, Bonoli,

2007, Midgley, 1999), a labour market training program (the Employment Support Program) was also

instituted for long-term unemployed and individuals on social assistance, which involved local

communities (Stewart and Flynn, 1997). The generosity of pre-existing legislations was also improved

substantially. For example, the minimum wage was raised substantially to the point of being the most

generous in Canada by 1981 and annual vacations were extended (Blakeney, 2008: 92-4).

Second, the development of Crown Corporations was a central plank of the CCF program for multiple

reasons. It fulfilled the need to diversify the Saskatchewan economy, which was too strongly dependent

on its farming industry. It generated another tool for the provincial government to control its own

economy without having to rely on the federal government. It also provided the necessary resources to

finance the welfare state (Pitsula and Rasmussen, 1990: 72, McLaren, 1998, Johnson, 2004). Two waves

of reforms occurred. During the Douglas years (1944-64) priorities was given to utilities resulting in the

creation of public enterprises such as SaskTel (telephone) and SaskPower (electricity), but also in the

expansion of royalties for the extraction of non-renewable resources. In the Blakeney years (1971-1982)

the expansion of the Crown Corporations occurred primarily in natural resources, with the

establishment of SaskOil, the Saskatchewan Mining Development Corporation (SMDC) and the Potash

Corporation of Saskatchewan (PCS). By the 1970s, the crown corporations were considered to be the

principle source of wealth to finance the welfare state (McLaren, 1998: 159, Harding, 1991a). This is very

important considering that the NDP has been strongly committed to having balanced budget, which was

originally sought to alleviate the fears that a socialist government would generate large scale deficits. In

fact, in the entire 1944-1964 and 1971-1982 periods, the CCF/NDP experienced only one deficit despite

being left with a substantial debt in 1944 (MacKinnon, 2003: 15).

Third, in the field of social policy, provincial initiatives are primarily confined to health, education and

social services because of the important role played by the federal government in the field of

unemployment and pensions. The CCF’s key contribution is the expansion of health coverage

culminating with the introduction of universal health insurance in 1965 amidst vivid opposition from

medical doctors that even featured a strike. Its model served as the template upon which Ottawa

assisted provinces to finance free and universal health care. Funds were also assigned to the University

of Saskatchewan to open a college of medicine (Johnson, 2004).

In the field of education, the Douglas government raised the minimum teachers’ salary by 30% and

re-organized the school administration by creating significantly larger school units with a new

equalization formula to ensure sufficient funding for rural school units (Government of Saskatchewan,

1944). Providing similar standards across a sparsely populated province represented a difficult challenge

and the reform faced strong opposition from localities. It nearly resulted in an electoral defeat in 1948

(Johnson, 2004: 86). Beyond the implementation of the larger school unit reforms, the department

created a new system of school grants and introduced a new high school curriculum (ibid, 147). With

regards to social services, in a noticeable shift from providing welfare as a form of poor-relief in favour

of a more universalistic notion of citizenship, a Department of Social Welfare was created with new

powers to spend money “as a matter of justice, equity and right” and to distribute “social aid”, which

replaced the term “relief” (Government of Saskatchewan, 1944: 32).

The Blakeney years built upon the Douglas legacy by fostering multiple innovations in social policy

(see Glor, 1997, Harding, 1991b). Two new programs, a prescription drug plan and children dental plan

were among those implemented. The Saskatchewan Prescription Drug Plan covered the entire

population (only British Columbia and Manitoba had a similar coverage) and the fixed dispensing fee

was waived for individuals on social assistance and it contained a cost-containment strategy by fostering

competition among drug suppliers with limited term contracts making it unique in Canada. (Burry,

1997). The Saskatchewan Dental Plan led the training of dentist therapists who then practiced in school-

based clinics resulting in services throughout the province (Wolfson, 1997). These programs were

supplemented by additional efforts in the health sector, including the construction of new hospitals in

rural areas. In the field of education, the most noticeable contribution was the transformation of the

Regina campus of the University of Saskatchewan into a full fledge university.

By the end of Blakeney’s third mandate in 1982, Saskatchewan was clearly identified as being a

leader with regards to welfare state generosity. Not only did Saskatchewan labour standards provided

more generous conditions and protections on most indicators than other provinces, such as higher

minimum wage and vacations, but they also introduced novelties such as maternity and paternity leave.

In terms of program coverage and costs, Saskatchewan was one of few provinces that did not levy

health premiums or payroll tax in Canada and its income tax system, utilise partly to finance health care

expenditures, was among the most progressive. While the combined provincial tax & health premiums

for income at the poverty line represented 7.5% of earnings in Ontario and 5.3% in British Columbia, it

was 1.6% in Saskatchewan (National council of welfare, 1982: 47-51). Moreover, the creation of

additional crown corporations added long-term financing for social programs. In less than 10 years, the

Devine government (1982-91) altered this outcome and subsequent NDP governments never succeeded

in restoring its place as a leader in Canada.

A Disappearing Legacy?

At stake with bureaucratic transformation is not only the implementation of change, but its

entrenchment over a substantial period of time. As demonstrated by Rothstein (1996), the

transformation of the underlying values promoted by the bureaucracy facilitates strongly the latter

objective. A remarkable feature of the Swedish welfare state has been its enduring stability despite its

vulnerability to external influence such as economic openness and EU membership. It continues to be

considered among the most generous welfare state (Lindbom, 2001, Korpi and Palme, 2003). This legacy

is largely absent in the case of Saskatchewan. This section analyses changes to the three core elements

associated with the socialist policies of the CCF/NDP.

First, multiple reforms were undertaken by the Devine government to curb the powers of unions and

modify labour standards to favour business interests. For example, the government introduced Bill 104

making it more difficult to unionize and Bill 73, which introduced more business friendly labour

standards (Pitsula and Rasmussen, 1990). Moreover, increases in the minimum wage lagged behind

other provinces pushing Saskatchewan among the least generous provinces.

Notwithstanding the fact that the Conservative government targeted unions and labour standards,

the key question for this contribution is whether these measures had long lasting effects. Evidence

suggests that it did not. While unionization rates experienced a noticeable decline in Canada averaging

6.7% between 1981 and 2004, Saskatchewan’s decrease of 2.6% was the second lowest behind

Manitoba at 2.5%. In the commercial sector, Saskatchewan experienced the lowest decline with a 5.5%

change compared with a national average of 9.8% (Morissette et al., 2005). In addition, in spite of a poor

performance with minimum wage legislation, a comparative study of labour standards in Canadian

performed by Brock and Roberts (2000) ranks Saskatchewan very favourably relative to other

jurisdictions. It is the most or second most generous when it comes to overtime, paid time off, workers’

compensation, collective bargaining, employment equity, and advance notice of plant closings (or large

scale layoffs). Only British Columbia is considered to have more generous labour standards. An updated

version of this study, which included other labour related benefits also ranked Saskatchewan quite

favourably with the exception of minimum wage legislation (Brock, 2005).

Second, the Conservative government was strongly committed to laissez-faire economics and crown

corporations were often a target for what was wrong with government. Following its re-election in 1986,

the Conservative government brought two former Thatcher advisers (Madsen Pirie and Oliver Letwin) to

Saskatchewan to engineer the sale of crown corporations (Pitsula and Rasmussen, 1990: 139-40).

Multiple crown corporations were sold and those recently established were a prime target: SaskOil,

Saskminerals, PCS, SMDC, Saskatchewan Computer Utility Corporation, Saskatchewan Government

Printing, Saskatchewan Forest Products, and part of SGI were all privatized. Saskatchewan crown

corporations were extremely important for a government seeking to retrench the welfare state since

they provided a key source of revenues to finance existing and new social programs introduced in the

1970s. None of these companies were later re-nationalised. Royalties on natural resources extracted by

private entrepreneurs, such as oil, were also reduced (Stobbe, 1991a). In addition, large scaled

public/private partnerships, where most of the risk was assumed by the government, were undertaken

with disastrous consequences for public finances since most of them never generated the expected

benefits, partly due to a lack of analysis and oversight (MacKinnon, 2003). Towards the end of the

second mandate of the Devine government, attempts were made to privatise the public utilities

established by the Douglas government. However, large scale demonstrations and protest resulted in

the abandonment of these plans (Pitsula and Rasmussen, 1990, Stobbe, 1991b).

Third, it is first important to note that most reforms to social policies occurred during the second

mandate of the Devine government (1986-1991) when reducing the deficits became a priority. Welfare,

however, did not fit this pattern. Breaking up with the legacy of previous CCF/NDP governments, the

Devine government initiated reforms targeting individuals on social assistance via the introduction of

workfare. A 35% cut in benefit for employable people served as incentive to join work programs and

accept low paying jobs, which enterprises offered via subsidy. Recipients also experienced a noticeable

decline in purchasing power ranging from 28% to 54% during the period 1981-88 (Riches and Manning,

1991). In health, the children dental program was eliminated and the 400 civil servants delivering the

program were fired (MacKinnon, 2003: 39). Reforms were made to the prescription drugs plan resulting

in deductible for everyone, including the poor and senior citizens (Harding, 1991c: 112-3). Budget for

education were frozen or raised below inflation rates.

The reforms introduced by Devine were followed by other retrenchment measures taken by

successive NDP governments to reduce the size of the debt and balance the yearly budget. The

cumulative effects have led Saskatchewan to become an average province when it comes to the welfare

state. Its social spending priorities are not very different from other provinces (Atkinson and Bierling,

1998). The Romanow government introduced one of the most extensive health care reform in the

country closing many hospitals in the process. Once the provider of a very generous drug plan, a recent

study reveals that Saskatchewan seniors pay more annually for drugs than all other provinces with the

exception of Manitoba (Demers et al., 2008). Moreover, it fares poorly on a key social outcome

associated with jurisdiction with dominant left wing governments : It has among the highest income

inequality in Canada (Breau, 2007, Osberg and Xu, 1999).

What Explains the Saskatchewan Reversal in light of the Swedish Experience?

This section presents three hypotheses to explain the puzzling difference between Swedish and

Saskatchewan socialist experiences. The first hypothesis focuses on the capacity of the opposition to

undermine the bureaucratic transformation implemented by socialist governments. The second tackles

the role of political appointees within the civil service and their ability to curb the influence of the

bureaucracy within the policy making process. The final hypothesis rests on the institutional elements

necessary to maintain a generous welfare state.

H1 – Once a radical change to the bureaucracy has been implemented, the likelihood of reversal is

strongly associated with the ability of a right-wing party to gain a majority of seat in parliament and

form its own government.

While it is necessary for a socialist government to be firmly in control in order to undertake a

profound transformation to its bureaucratic structure and its values, the contrary is true for these

changes to have long lasting effects; the ability of subsequent right-wing governments to reverse this

outcome matters. This is a key difference between Sweden and Saskatchewan. Once a strong social

democratic influence was embedded in many Swedish agencies, it was particularly difficult for a right

wing government to implement changes that would challenge this bias. A key issue is the lack of a

cohesive alternative. The right wing coalitions have been quite divided and ill equipped to mount a

challenge to both bureaucratic structure and values. In addition, Sweden also never faced a government

strongly committed to ‘eradicate’ the bureaucracy. In fact, there are even some contributions

supporting the thesis that its most right wing party in coalition governments, the conservative party,

also had a well developed social agenda (Ljunggren, 1992) or that it has accepted that the “welfare state

is irreplaceable” (Lindbom, 2008).

The Saskatchewan situation was quite the opposite. One party governments are the norm and once

in power, few hurdles prevent the adoption of a radical agenda. In stark contrast with the Swedish

Conservatives, the Conservative Party of Saskatchewan was strongly committed to a neo-conservative

agenda à la Thatcher, which would restore private initiatives. The bureaucracy, strongly associated with

the CCF/NDP, was targeted throughout electoral campaigns and once in government. This led to a

profound transformation of the province and its future capacity to revert to previous policies. In the

aftermath of Devine: “What was once considered Canada’s most progressive province has become one

of the most right wing” (Pitsula and Rasmussen, 1990: 5).

It is far more difficult to alter the bureaucracy than bypassing it. In the case of left wing

governments, it needs a well functioning and committed bureaucracy to expand the role of the public

sector. Thus, it must ensure that the bureaucratic will is altered and/or created to facilitate the

achievement of these objectives (Lindqvist, 1990, Rothstein, 1996). In the case of Saskatchewan, this

was well understood by Premiers Douglas and Blakeney and a key element associated with the

expansion of the welfare state was that the bureaucratic will was geared towards introducing

expansionary policy innovations (Glor, 1997, Brownstone, 1971, Johnson, 2004). In the case of neo-

conservative governments, the role of the public bureaucracy is usually considered to be negative; it is

targeted as a reason why government is failing and continues to grow in importance (Niskanen, 1971).

Within this context, the political control of the bureaucracy becomes a key goal of neo-conservative

governments (Aucoin, 1990, Boston et al., 1996, Savoie, 1994). Therefore, efforts will be made to avoid

utilising the bureaucracy in favour of external expertise and reliance on the markets, which lead us to

the second hypothesis.

H2 – The public administration needs to conform to the principles associated with a professional civil

service. As such, recruitment needs to be based on merit and civil servants are granted tenure following a

brief probationary period. While a strong expansion of the civil service combined with strong persuasion

efforts are required by a socialist government to convert or capture the bureaucracy, all these efforts will

be in vain if the following government can dismiss or fire easily civil servants associated too closely with

the previous governments and/or its policies.

Patronage policies were effectively eliminated early in Sweden. By the mid 1800s, the civil service

was already operating with the principles of tenure and hiring on merit. The institutionalisation of the

policy making process, with its strong reliance on parliamentary inquiry where bureaucratic experts

from the civil service play a vital role (Arter, 1990, Premfors, 1983), has also cemented a strong

relationship between political actors and civil servants in the conduit of policy. In addition, most of the

civil service is employed by state agencies (styrelse or verket) whose primary responsibility is to

implement policies and manage programs. These operate at arms-length from ministries, which have a

very small staff (Pierre, 1998). Within such a setting, it is extremely difficult to sidestep the bureaucracy.

In contrast, the Douglas government had to create a professional civil service capable of servicing the

need of an interventionist government. Had it not done so, the British experience tells us that he would

have probably not been able to do much in terms of expansionary social policies (Heclo, 1974). There

was no well established expertise within the public administration and an institutionalised policy making

process as in Sweden. The Douglas government was quite successful in attracting qualified individuals

with expertise in public administration because Saskatchewan provided opportunities to innovate and

develop concrete programs and to diversify one’s skill set via employment in the crown corporations. In

addition, the working conditions were very generous with a public service commission, a collective

agreement, educational leaves, and pension schemes (Brownstone, 1971).

Saskatchewan, like other Canadian provinces, operates under the Westminster model. However,

contrary to the United Kingdom, its bureaucracy does not follow completely the principles associated

with the traditional Whitehall model of public administration. The Whitehall model stipulates that: (1)

recruitment is strictly merit based with tenure granted to civil servants; (2) the civil service forms a

single body; and (3) the politicians depend on the civil service for both policy implementation and policy

advice (Wilson and Barker, 2003). The professionalization of the civil service within this model makes it

very difficult to fire civil servants and avoid their influence within the policy making process.

There are two main streams of appointment within the Saskatchewan civil service. First, the vast

majority of civil servants are recruited on merit and granted tenure under the auspice of a collective

agreement, which is managed by the Public Service Commission. Second, civil servants can be appointed

by the cabinet. Two categories of civil servants fall under this category, partisan staff and senior civil

servants. Originally, in the 1906 Public Service Act the recruitment of civil servants were “at the pleasure

of the Crown” and were thus appointed directly by Cabinet, which facilitated patronage (McLaren, 1998:

8-9). In spite of the 1947 Public Service Act and the establishment of a merit based bureaucracy with a

Public Service Commission (PSC), civil servants can still be hired “at the pleasure of the Crown”. These

appointments, however, can be very precarious since “government employees may be dismissed

summarily without severance pay in the absence of protective legislation” (Neilson, 1984). While

partisan staff is expected to resign following an electoral defeat, the situation is much more problematic

in the case of senior civil servants because nominations may not have been politically motivated. In

these cases, it is the interpretation of the new political masters that matters.

A somewhat standard practice has been developed in Saskatchewan concerning the dismissal of key

senior civil servants (Rasmussen, 2001). In the event of a lost election, one of the last orders of business

for the outgoing government is the termination of contract for political staff. Recently, in 2007, the NDP

fired 150 top political staffers at its last cabinet meeting (Star Phoenix, January 18, 2008). However, the

newly elected government has the last say concerning who can stay and who else should be terminated.

The current government headed by the Saskatchewan Party has fired an additional 70 civil servants,

some of whom were clearly not appointed on a partisan basis by the previous government (Leader-Post,

January 25, 2008). As a result, observers have stated that Saskatchewan, and other provinces, have

much more in common with the appointment practices of the United States than with the Whitehall

tradition of internal promotion for senior civil servants, as practiced in Canada, at the federal level, and

the UK (Michelmann and Steeves, 1985: 18). As in the United States, the creation of a transition team

with an eye on civil service appointments and dismissals is now a common practice. While these

appointments affect less than 3% of civil servants,8 they involve those at the very top of the service.

This is not very different from Swedish practices, however, where 4.5% of individuals working within

Ministries are political appointees and they perform similar functions. For example, the equivalent of

the Deputy Minister, Statssekreterare, is also chosen by the government (Dahlström and Pierre, 2010).

The key difference is that Swedish ministries might be becoming more politicized, they remain relatively

small. For example, the Ministry of Health and Social Affairs has 200 employees, 30 of which are

politically appointed (Socialdepartementet, 2009). The implementation of policies occurs within boards

and agencies that operate at arms-length from ministries. They are well staffed and highly influential.

For example, the Social Insurance Agency (Försäkringskassan), one of the many boards under the

supervision of the Ministry of Health and Social Affairs, has 13 500 employees and no political

appointees beyond the Director General and members of the administrative council (styrelsen) . It is the

buffer between the ministries and the agencies/boards that protects civil servants from strong political

interference rather than the actual politicization of ministries. Such a setting is absent in Saskatchewan.

These transitional practices have an important impact since they can curb the underlying values of

the civil service and effectively introduce new input that is more in line with the political ideology of the

newly elected government. The election of Russ Thatcher from the Liberal Party in 1964 resulted in the

departure of a core group of civil servants associated with the administrative revolution orchestrated by

Douglas and the CCF, although most did so voluntarily (MacKinnon, 2003: 15). Throughout its time in

opposition, Thatcher gathered substantial interest and publicity for his criticism of the CCF civil service

and its infusion of foreign experts (Smith, 1975: 275). First, in spite of a strong rhetoric against the civil

service and the centralisation of power within the hands of the Premier, few structural changes

occurred during the Thatcher years (1964-1971) (Dunn, 1995). Some departments also continued to

expand their activities. For example, a Special-care Services Division was established within the

Department of Welfare to oversee the development of subsidized day-care (Department of Welfare,

1971). The EAPB would be dismantled and it reappeared later in a modified form, but played a

substantially reduced role within the policy making process. Second, and more importantly, a high

number of senior civil servants operating in central offices resigned. This affected particularly the EAPB

office. However, the Budget Bureau had a high retention rate (McLarty, 1979). As a result, the influence

8 According to Rasmussen (2001), there are 11 000 civil servants in Saskatchewan. There are usually 200 to 300 dismissals when a new party wins an election.

of the Budget Bureau grew tremendously during the Thatcher and Blakeney years, while the EAPB

became a highly politicized office whose influence faltered across successive governments.

While the election of Thatcher did not result in a significant changes within the civil service (Dunn,

1995, Michelmann and Steeves, 1985) making it possible for the Blakeney government to pursue an

expansion of the welfare state with the support of a strong civil service, the election of the Devine

government in 1982 proved remarkably different. The Devine government ignored most of the advice

given by civil servants and undermined their authority by substantially increasing the number of political

appointees, eliminated multiple positions, and even sought to decentralise radically the civil service with

its very controversial Fair Share program. The latter, which was only implemented in a few cases, sought

to decentralise the civil service by moving multiple offices from Regina to rural areas.

The number of dismissals in the early days of the Devine government was approximately two

hundred, which did not include the sixty nine officials who had already resigned (Michelmann and

Steeves, 1985). The most intriguing question, which is not addressed anywhere in the literature, is why

did the Blakeney government hired more than 1000 civil servants at the pleasure of the crown instead of

regular process in place by the Civil Service Commission? Dismissal of appointed civil servants aside, the

Devine government went further by targeting civil servants appointed on the basis of merit by the Civil

Service Commission. It sparked a series of legal action against the government. Much to the dismay of

civil servants, the penalty for these actions did not dissuade the government from continuing the

practice: the Courts ordered a one year severance pay (with benefits) and court costs even for cases

where firing occurred without cause (Norman, 1990).

Unfortunately, it is nearly impossible to assess clearly the extent to which Devine succeeded in

reducing the size of the bureaucracy, which explains why so many accounts focus on individual

experiences. McLaren (1998) provides the best evaluation. Although the official numbers indicate a

reduction of 26% (4067) in the number of civil servants during the 1982-1991 period, some were simply

moved to semi-independent agencies. For example, the Civil Service Commission indicates that 2400

jobs were eliminated in 1987-88, but this was never did not result in changes to the payroll (175).

Interestingly, 1000 civil service jobs were eliminated during the later part of the Blakeney mandate,

which represented a “real” 7% reduction (Saskatchewan, 1980: 25). Another key difficulty in this kind of

exercise is that one does not know how many civil servants were simply replaced. For example,

following the victory of the NDP in 1991, the new Minister of Social Services was shocked to discover

that her department was filled with accountants and political appointees instead of social workers.

Many individuals hired originated from out of department appointments (MacKinnon, 2003: 38-9 and

69).

Once it returned to power in 1991, the civil service had faced a profound transformation and its

policy capacity was at an all time low. Despite facing extraordinary financial pressures, the first order of

business for the Romanow government was to “revitalize the civil service” (MacKinnon, 2003: 61) but it

never succeeded in re-connecting with the civil service in ways akin to the Blakeney era because there

was so much mistrust within the civil service (and between the civil service and the government)

sparked by suspicions vis-à-vis senior civil servants who were not fired during the Devine years (73-4).

The special relationship between the NDP and the civil service changed and the later was not longer

considered to be the creative engine for the government.

“The NDP did not engage in the inflamed rhetoric of administrative reform, and

avoided language which portrayed the bureaucracy as wasteful, incompetent, out of

control and unresponsive to political control. But while avoiding a reform agenda the

NDP government has not attempted to rely on the public service as a major

institution of social and economic innovation as was the case in the past. As a result

the public service in Saskatchewan has entered a period of stasis in which is has

neither become a policy innovator working closely with a government with clearly

articulated goals, nor has it become a leader in the development of new techniques

and practices of public management” (Rasmussen, 2001: 97).

H3 – The nature of the elements linked to the development of the welfare state matters. The dynamic

surrounding the long term impact of retrenchment measures vary. Among the three elements studied,

regulations are the easiest to reform and restore, the privatization of crown corporations and losses of

revenues are quite difficult to reverse and it has strong financial consequences on the future of social

programs. In line with the politics of the ‘new’ welfare state, the maturation of social programs also

increases the difficulty of reforming them.

Successive Saskatchewan governments were very active introducing and reforming labour standards

and union legislation. Accounts of the Devine period suggest a substantial alteration of both labour

standards and union legislation. However, as indicated by the comparative assessments of Brock and

Robert (2000) and Brock (2005), subsequent NDP governments were able to restore Saskatchewan’s

status as one of the most labour friendly province within Canada.

Contrary to redistributive programs and social services, regulations do not require strong financial

commitments on the part of governments because the costs are (mostly) externalised. In fact, this is a

core reason behind the use of this instrument by the European commission to expand the role of the EU

in social policy (Cram, 1993). Therefore, the re-introduction of generous labour standards and pro-union

legislation can be easily achieved by a majority government headed by a socialist government.

The legacy of crown corporation privatizations represents major long-term obstacles in the

restoration of generous social policies. This represents a substantial systemic retrenchment because this

reshapes the political economy surrounding the welfare state by reducing the financial ability of future

governments to maintain and develop future social programs (Pierson, 1994: 15). This is crucial in the

case of Saskatchewan because it is a province within a federation that has extensive fiscal powers. The

CCF/NDP developed this practice as a mean to obtain a reliable source of revenue, which is particularly

important in a province where most individuals’ income are dependent on world prices for agricultural

products, to undertake a rapid and generous expansion of social program. In the Blakeney years, this

was adopted aggressively following actions by the federal government to contest provincial authority to

levy royalties (Blakeney, 2008). Nonetheless, royalties on non-renewable resources continued to provide

a substantial amount of revenue. “The Blakeney government saw resource revenue, not federal cash, as

the means to expanding the province’s welfare state” (McGrane, 2007: 282). Revenues from crown

corporations represented the key element that made it possible for Saskatchewan to have more

progressive social policies than other Canadian provinces. This is akin to the comprehensive and efficient

Swedish tax system, which allows the Swedish government to spend more on public programs than

other countries (Steinmo, 1993).

It is difficult to assess how much future governments have lost in revenues as a result of these

privatizations and the lowering of royalties. Financial data were not available from Saskatchewan

Minerals and SaskOil underwent multiple mergers making it difficult to project the amount of revenue

lost. This is not the case, however, for Potash.9 The company has remained very similar and Potash still

has the characteristics of a public good due to a lack of competition (McLean). On average net revenues

9 Need to account for the fact that the sale of the corporation resulted in the collection of new royalties….

have represented close to 3% of total revenue during the period 1990-2006.10 To make matters worst,

the Devine government ignored the advice of bureaucrats by selling the Potash Corporation at a later

date resulting in a much lower selling price costing the province $361 million (MacKinnon, 2003: 101).

Royalties were also significantly reduced in an effort to attract more business. While close to 65% of the

sale value of oil went to government coffers, the amount dropped significantly to 21.5% in 1989. While

substantial reduction in gasoline taxes and a mortgage subsidy to cover interest payments in excess of

13.25% contributed to the deficit, the re-structuration of oil royalties was the most significant fiscal

decision. The loss of revenues from this alone represented close to $4 billion (Stobbe, 1991a).11

The loss of assets and royalties, risky partnerships on megaprojects with the private sector, interests

on the debt all contributed to a $14.8 billion debt. This represented 180% of the province annual

revenue compared with an average of 115-120% for other Canadian provinces (MacKinnon, 2003: 101-

2). As such, Saskatchewan went from one of the most fiscally sound province to the worst in Canada.

Within this context, a reversal of policy was simply too expensive. In addition, beyond the cost a re-

nationalization would require, such action would contravene the North American Free Trade Agreement

between Canada and the United States (McGrane, 2007). As a result, it is not surprising to notice that

Saskatchewan is now very similar to other Canadian provinces when it comes to social spending.12

Conclusions

There are three main contributions related to the analysis of the transformation of the bureaucracy

by the CCF/NDP and the establishment of a socialist program. First, confirming earlier findings

(Rothstein, 1996), the transformation of the bureaucracy was a key element in the successful

implementation of a socialist agenda. As such, the bureaucratic apparatus was clearly designed to

support the expansionist social policies promoted by the CCF/NDP (Johnson, 2004). There is strong

10 Calculated from the official publication of the new corporation and the revenue figures were obtained from Statistics Canada. 11 It should be noted however that this amount assume that oil would have been extracted at the same rate in spite of the higher royalties, which is unlikely.

12 ADD? It is worth stressing that the Devine government was successful in selling recently established public companies, but failed to do so with the public utilities that were established in the 1950s (SaskTel, SaskPower, and SGI). In the later case, the opposition to the sale was easier to mobilize because they represented well-established provincial symbols and the unions were entrenched strongly within these companies (ADD REF).

evidence supporting the thesis that a socialist bias permeated the bureaucracy until the early 1980s. The

bureaucracy will was considered a key element in the multiple innovations introduced during the

Blakeney years (Glor, 1997) and the bureaucracy was a constant source of criticism by both the Liberal

and Conservative Parties.

Second, the socialist legacy was seriously compromised following the election of the Conservative

Party in 1982. By the end of their second term in 1991, the bureaucracy had been radically altered

eradicating decades of socialist transformations. The Devine government successfully dismissed a high

number of civil servants and marginalised the role of the civil service within the policy process. An

important conclusion is that it is easier to transform a bureaucracy when a government is seeking to

dismiss its influence rather than trying to alter its bias to achieve specific policies. The limited likelihood

for a single party government firmly anchored on the right, the presence of well established agencies at

arms-length from ministries, and the strong powers of parliamentary committees explain why the

Swedish bureaucracy has not faced a similar challenge.

Third, the most important measures taken by the Devine government to retrench successfully the

welfare state were the sales of crown corporations established by the previous government. These

affected the revenues needed to finance the Saskatchewan welfare state. The lack of revenues from

crown corporations and bulging deficits made it impossible for successive governments to re-establish

as generous a welfare state. In fact, it prompted them to make substantial cuts to existing social

programs.

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