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Health Care: Funding a Canadian PriorityRemarks by David Kilgour, MP for Edmonton SoutheastHouse of Commons, Ottawa37th Parliament, Third SessionEdited Hansard no. 02411 March 2004Hon. David Kilgour (Edmonton Southeast, Lib.): [...]Let me speak first to the
repeated provincial claims that the federal share of health spending is in the
14¢ to 16¢ range. To arrive at this figure the provinces, and I believe the
Bloc, divide the cash portion of the Canada health and social transfer, the CHST,
by all of their social spending in the social domain, not just their health care
spending. They include also social services and primary, secondary and
post-secondary education in their calculation. It
seems to me that it is misleading to use the total amount of provincial social
spending to calculate the federal share of provincial health care spending.
Total provincial health spending is actually $77 billion compared to $143
billion for social spending. It
is also misleading for the provinces to ignore the $17 billion in CHST tax
points provided by the federal government and the more than $10 billion
transferred to provinces through the equalization programs. These amounts are
available for health care spending and the choice is up to the provinces. The
CHST is a block fund which provides flexibility to the provinces to allocate the
funding according to their own priorities. In short, they can spend as much of
the CHST on health as they choose. Under the CHST there is no share of federal
transfers earmarked for health care, none. Provinces have full flexibility to
spend all or any part of the CHST and equalization on health care. It
was by mutual agreement that cost sharing of specific provincial expenditures on
health and post-secondary education were changed to block funding. This gave all
of the provinces much greater flexibility on how they would allocate federal
transfers. The
provinces have complained that cost sharing distorted provincial spending
decisions and favoured better off provinces since they could afford to spend
more and so attract more federal dollars than the less well off provinces.
Effective April 1 of this year the federal government will create a new Canada
health transfer to improve transparency and accountability of federal transfer
support for health. What
exactly is the federal contribution to health spending? We have all asked
ourselves that question. The federal government contributes to provincial health
spending through the CHST, both cash and tax points, and equalization and makes
substantial and direct contributions to health care and health research. Let
us look for a moment at the CHST, that is, cash and tax points, which amount to
almost $38 billion in 2003-04 including the $1 billion CHST supplement. The
current CHST supports health, post-secondary education, social assistance,
social services including early childhood development and early learning and
child care services. I wonder how many members of the House accept this. Since
health spending represents about 62% of the total that the provinces spend in
these attended areas, it is reasonable to assume that they spend 62% of the CHST,
on average, on health annually. That is more than $23 billion of the annual CHST
transfer. Adding the $1 billion in support from the new health reform fund
increases the amount to over $24 billion. This total of over $24 billion is an
amount equal to 32% of provincial health care spending of $77 billion. What
is the additional federal contribution to provincial health spending through
equalization? The federal government provides eight of the ten provinces with
equalization and they are free to allocate as much of that money as they choose
to health. On average, provinces are spending about 38% of their program budgets
on health care. I thought it was higher than that, but the finance department
insists that it is only 38%. It is reasonable to assume that 38% of the annual equalization
goes to health, which means that more than $3 billion a year for health care.
Added to the more than $24 billion in federal support through the CHST, the
health reform fund which I mentioned, this brings the federal contribution to
approximately $28 billion or 36%. I would suggest that we are getting a long way
from 16% of provincial health care funding. Finally,
what about direct federal contributions to total public health spending? The
federal government's direct spending for health care is estimated at
approximately $5 billion in 2003-04 and that is for first nations health,
veterans health, health protection, disease prevention, health information and
health related research. As well, through the tax system, the federal government
provides support worth about $1 billion a year. That includes credits for
medical expenses, disability caregivers and infirm dependents. It
is not much of a secret where I am going. When we add the over $6 billion in
direct spending and tax credits to the $28 billion in transfers to the
provinces, the federal government is currently providing about $34 billion a
year, or more than 40% of all national public spending on health care in Canada.
We all hope this amount will continue to grow, and of course following recent
investments outlined in the budget of 2003. In
summary, health care makes up 62% on average of what the provinces spend on
social programs covered by the CHST. As I have said, that makes it reasonable to
infer that probably 62% of the CHST is spent on health. If we add the federal
support to the health reform fund, and that came to $24 billion, I do not think
I need to repeat what I have just said. In
short, the federal government's contributions would strongly appear to be more
than 40% of all national public spending on health care in our country. -30- |
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