Premiers call for more funding for health care - Brief Article - Statistical Data Included

Community Action, August 19, 2002

HALIFAX -- Provincial premiers and territorial leaders called for a new funding partnership for health care at their August meeting.

Provincial/territorial health care spending has grown by an average of $4.25 billion per year over the past five year, they said. The increase amounts to an average of more than $560 for each Canadian, an amount the premiers said is unsustainable.

They cited a Conference Board of Canada report that predicts a rising vertical fiscal imbalance. The distribution of revenue resources between the federal and provincial/territorial orders of government is inconsistent with the cost of meeting their respective constitutional spending responsibilities.

In health care, the Conference Board reported total provincial and territorial public health expenditures will reach $166.5 billion in 2019/20, up from $63.5 billion in 2000/01--an average annual compound growth rate of 5.2 per cent. In the big picture, provinces and territories will collectively be in a deficit position during that period even though the federal government's surplus is predicted to be $85.5 billion by 2019/20. The federal interest-bearing debt will be virtually eliminated.

The premiers called for new financial arrangements for health care, including:

* immediate removal of the equalization ceiling;

* immediate work on a strengthened and fairer equalization program formula, including as one possible alternative, a ten-province standard that recognizes the volatility around resource revenues, and comprehensive revenue coverage;

* restoration of federal health funding through the Canada Health and Social Transfer to at least 18% and introduction of an appropriate escalator;

* work on other measures, including tax point transfers as one possible alternative to the current CHST transfer.

The Premiers' Council on Canadian Health Awareness will begin a public information campaign on these issues this fall.