Premiers ‘disappointed’ by lack of new funding but want time to assess Ottawa’s proposal

Prime Minister Justin Trudeau announced Tuesday the federal government is prepared to spend an eye-popping $196.1 billion on health care over the next decade — including $46.2 billion in new spending on top of funds already budgeted.

The deal, which is being pitched by the federal government as a generational fix for an ailing system, would begin with provinces and territories getting an unconditional $2-billion boost to the Canada Health Transfer (CHT) to address what the federal government calls “immediate pressure on the health-care system, especially in pediatric hospitals, emergency rooms and surgical and diagnostic backlogs.”

Trudeau’s proposal also includes a five per cent annual hike to the CHT for the next five years, with a built-in mechanism to permanently increase funding in the years after.

After the first five years, the CHT escalator will revert to a three per cent increase each year — but provinces and territories will be starting from a bigger base after years of larger than normal increases.

Government data suggests this funding boost will increase the CHT by some 61 per cent over the next 10 years. That amounts to about $17.3 billion in new money for the provinces and territories to prop up a faltering system.

Premiers want time to assess proposal

Following their meeting with Trudeau, the premiers said they wanted to take time to assess the federal proposal. They also said they would like to see the federal government put forward additional money.

Manitoba Premier Heather Stefanson is the current head of the Council of the Federation, the group that represents the premiers. She said the premiers were “disappointed” by the size of Trudeau’s proposal.

“It’s significantly less than what we’re looking for,” she said.

The premiers had been asking Ottawa to increase the Canada Health Transfer to provinces by $28 billion a year.

Stefanson said that doesn’t mean the provinces and territories will reject the proposal outright.

“We just received that proposal today,” Stefanson said. “We’ve only had it for a couple of hours.”

Stefanson said the premiers would take time to assess the proposal and reconvene another Council of the Federation meeting within “days.”

“It is more money than it was yesterday,” she said.

Ontario Premier Doug Ford said he saw this proposal as a “starting point.”

“It’s a down-payment on further discussions,” he said.

During a press conference Tuesday evening, Trudeau was asked multiple times if he would be willing to offer more money or if this proposal is his final offer.

“This is the offer we put forward on the table,” he said. “This is the billions of dollars that are there for provinces and we certainly look forward to working with them to be able to deliver not just that money, but those health-care improvements to citizens across the country.”

New Brunswick Premier Blaine Higgs told CBC News Network’s Power & Politics that he wasn’t optimistic about pushing Ottawa to increase its offer any further.

“It wasn’t a negotiation in that meeting at all,” Higgs told guest host Catherine Cullen. “We have what we have. We’ve got to find a way to work with that.”

Higgs said the current offer is “better than no increase at all.”

Federal conditions

To access the enhanced CHT, provinces must first commit to improving how health data is “collected, shared, used and reported to Canadians to promote greater transparency on results, and to help manage public health emergencies,” the government said in a background document supplied to reporters.

The federal government wants this data so that it can better track health-care performance and outcomes.

It also says it want this information shared more efficiently between primary doctors, pharmacists, specialists and the hospital system.

“Canadians should be able to access their own health information and benefit from it being shared between health workers across health settings and across jurisdictions,” the government said in its backgrounder.

Trudeau is also pitching $25 billion over 10 years to advance what the government is calling “shared priorities.”

This new $25-billion pool of funds is in addition to the $7.8 billion over five years the government already has earmarked for mental health, home and community care and long-term care.

As part of ongoing health-care talks, the federal government has said it wants to sign bilateral deals with each province and territory to earmark money for the health-related issues that each jurisdiction cares about most.

But Ottawa is insisting that those new funds be directed at four priority areas: family health services, health workers and backlogs, mental health and substance use and a “modernized health system.”

The new federal funding will be contingent on the provinces and territories chipping in some of their own money for these “shared priorities.”

They also must agree to uphold the Canada Health Act, federal legislation designed to ensure that access to health care is based on need and not an ability to pay.

The premiers will be asked to develop an “action plan,” which will detail how these funds will be spent and how progress will be tracked.

Canada spends roughly $330 billion a year on health care, according to data from the Canadian Institute for Health Information.

Last year, the CHT cost the federal treasury $45.2 billion. Even before today’s talks, it was set to increase to $49.1 billion in this fiscal year.

With the new funding announced Tuesday, the CHT and the separate bilateral funding arrangements will be worth about $54 billion in 2023-24.

Ottawa is also proposing $1.7 billion in new spending over the next five years to increase the wages of personal support workers (PSWs). There’s another $150 million over five years for the Territorial Health Investment Fund, to help the Northwest Territories, Nunavut and Yukon pay for some of the added costs that come with health care in the north.

In addition to this new cash for the provinces and territories, the federal government is promising more money for Indigenous health, an area that is largely under federal jurisdiction.

Trudeau’s plan calls for an additional $2 billion over 10 years for an “Indigenous-specific funding stream,” to address what the government called “unique challenges” that “Indigenous peoples face when it comes to fair and equitable access to quality and culturally safe health care services.”