Oct 19, 2020

With increasing frequency, governments have been using informal directives to implement policy rather than the more traditional and formal instruments like regulations and by-laws. A recent decision constraining the authority of government to rule through directives has important implications for autonomous agencies.

In Canadian Federation of Students v Ontario, 2019 ONSC 6658, http://canlii.ca/t/j3hcc the Cabinet of Ontario issued a mandatary guideline that universities ensure the fees it charges students for student organizations be optional. The Divisional Court found that universities were independent of government and there was no authority under the enabling legislation for the Cabinet to issue a directive on this matter. The fact that a significant portion of the funding of universities came from government did not authorize government to impose this restriction on its funding without statutory authority. The Court was unwilling to imply the authority of government to impose this sort of restriction where the enabling statutes were silent on the point.

The enabling statute of many regulators provides some authority for the relevant Minister to intervene in the affairs of the regulator. However, according to this case, that authority (and whether it is to be exercised informally or formally) likely goes no further than what is expressly described in the statute.