TORONTO – Provincial premiers have long been “crying” about “insufficient” (in their view) federal contributions to their health spending, but the reality is different, according to an analysis of two decades of health financing data, by Canadian Press with Humber College’s StoryLab: Federal transfers always grew year after year.
The research is based on data from provincial health budgets and federal health transfers from 2004 to 2023 since the launch of the 2004 federal-provincial health deal, made under former Liberal Prime Minister Paul Martin. Well: the results are in stark contrast to the rhetoric that has characterized federal and provincial health negotiations in recent years.
Indeed, rather than declining slowly over the past two decades, as premiers recently claimed, federal transfers have actually grown at a slightly faster pace than provincial health spending since the 2004 Martin Agreement. In 2005-2006, for example, federal health transfers grew 39% in one year, while provincial health spending grew 6%. That means the federal share of total health spending jumped to 20.7% from 17.5%. More recently, federal health spending was much higher during the Covid-19 pandemic due to specific transfers: such additional funds stopped flowing in 2022-2023, when the federal share of total provincial spending grew only slightly at 21.2%.
In 2023, federal health transfers amounted to $47.1 billion, a 212 percent increase over 2005, when the transfers were $15.1 billion. Total spending by all 10 provinces grew in that time to $221.9 billion up from $86.2 billion, an increase of 158 percent: a percentage significantly lower than the one of the increase in federal contributions.
“I understand the Provinces’ position — huge demands on them — but we’ve made sure we provide the dollars needed and requested to help them with their health systems,” federal Health Minister Mark Holland said in a recent interview. “Now what we need to do is start transforming the way our system works. We need to move from a crisis-based system where we wait until people are really sick and then deal with the situation, to being against the grain and avoiding illness and engaging in prevention.”
The premiers, however, remain of their opinion: the funding is not enough and cannot be “term-based”. According to the various provincial governments, in fact, it is necessary that “the federal government provides adequate and sustainable funding for health care” and this also means removing the “deadline” from the agreements, since with that it is impossible to plan for long-term stability.
In February 2023, about ten days after Prime Minister Justin Trudeau made the latest offer of health funding after a long standoff with the Provinces, the premiers issued a joint statement reluctantly accepting it: “While this first step signs a positive development, the federal approach clearly will not address the structural financing needs of healthcare, nor the long-term sustainability challenges we face in our healthcare systems across the country”.
The one thing that is clear is that health spending is growing. Per capita, Canada’s health transfers have grown six times faster than population growth, amounting to $1,115 per capita in 2023, up from $427 per capita in 2019. 2005. And it is, of course, destined to increase.
Photo by Parentingupstream from Pixabay
