Who pays for what?

by Aaron Wherry

In an interview with the CBC—to be broadcast this evening—the Prime Minister rejects the idea of a health care innovation fund (as proposed by Brad Wall and endorsed by Dalton McGuinty).

“What I think we all want to see now from the premiers who have the primary responsibility here, is what their plan and their vision really is to innovate and to reform and to make sure the health-care system’s going to be there for all of us,” Harper said, according to an excerpt from the interview. “So I hope that we can put the funding issue aside, and they can concentrate on actually talking about health care, because that’s the discussion we’ll be having.”

The idea of a separate fund for the provinces to use for innovation in the delivery of health care got no support from the prime minister. ”I’m not looking to spend more money. I think we’ve been clear what we think is within the capacity of the federal government over a long period of time.”

Meanwhile, in an interview with CTV yesterday, Mr. McGuinty mused intriguingly of “disentanglement.”

The feds do jails and we do jails. The feds do training and we do training. The feds inspect meat and we inspect meat. Why don’t one of us, alone, take responsibility for some of those areas. I think that introduces more efficiencies, it introduces more transparency, accountability is more easily evident. I think those are the kinds of conversations that we need to have going forward in an era of fiscal restraint.

The Ontario premier arrived at this point in response to a question about the Harper government’s crime policies and the burden they will place on the provinces, so perhaps this seems tangential to the health care debate. But maybe it’s all part of the same discussion. Consider the analysis of Scott Clark and Peter DeVries that I noted this morning.

Your recent decision to tie the growth of health transfers to GDP growth after 2016-17 indicates that you now recognize that there is a structural component that needs to be confronted. This unilateral decision, without any prior discussion with the provinces and Canadians, will go along way to eliminating the structural deficit of the federal government. However, this will be achieved by simply shifting the structural deficit problem to provincial governments. Canada “Incorporated” will be no better off by this decision. Provincial governments will now have to find additional ways to deal with pressures on health spending by further cutting their program spending, raising taxes, or going into debt. As there is only one taxpayer, Canadians should be aware of this.




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Who pays for what?

  1. Hey Dalton…Canada has a constitution with a separation of powers.  Perhaps you should read it, instead of saying that one can simply ignore it.

    • Why do we have a Federal Ministry of Health?

    • Isn’t that McGuinty’s point???  Yes, we have a separation of powers in the constitution, and yet, the feds build jails and the provinces build jails.  The feds do training, and the provinces do training.  The feds inspect meat, and the provinces inspect meat…

      I thought McGuinty’s whole point is that we’re ignoring the constitutional separation of powers RIGHT NOW, and that maybe we should clean that mess up and actually separate the activities that derive from the separation of powers.

      • McGuinty wants to ignore the separation of powers.  The Constitution says the Feds define criminal law, and that the provinces enforce it. 

        Harper is actually trying to slowly get rid of the needless unconstitutional duplication created by previous federal Liberal governments that intruded needless in provincial jurisdictions constitutionally.

        It is hilarious to see the provinces, and even Quebec, now begging for the Feds to interfere in the provinces constitutionally defined jurisdictions.

        When the Feds messed around, it gave the provinces a copout.  They could blame the Feds.   Harper is writing bigger cheques for health care than ever before, and will continue to tied to nominal GDP after 2017 (recession-protected with the 3% guarantee) with only the strings being the legacy Liberal Health Care Law of universality, etc.

        The provinces now have to accountable for their own constitutional responsibilities, instead of blaming Ottawa.

        • The constitutional  ’separation of powers’ was written in 1867….when healthcare consisted of…at most…a doctor showing up at your door in a horse and buggy.

          And education consisted of …at most…. a one room school house, or a church.

          They couldn’t forsee what we have today…..which is why, years ago, the govt tried a better way of doing things.

          As to the cost, and the cheques…..’At one time, he said, it was 50 per cent. The Romanow Report of 2002 recommended it be around 25 per cent, said Mr. Charest. It now sits at about 20 per cent …’

          I notice the Republican version of the constitution is now being tried here.

          Healthcare they say, isn’t mentioned in the US constitution….nope, it isn’t. Neither are glasses, cars, TV or the web. So?

          • “the govt tried a better way of doing things”

            You mean that the federal govt tried unilateraly to change the fundamental balance of power in the federation, against the very nature of our political system.

            If some people think that the constitution should be changed, then a constitutional ammendment should be required. The so called federal spending power is a farce.

          • No, they all got together to find a way forward.

            The ‘very nature’ of our political system is cooperation.

            I’d love to change the constitution….no equalization payments.

        • So, the crux of your argument about McGuinty is to cite the one example he doesn’t point to (except in that the feds are building prisons and the provinces are building prisons… and why is that if we hold the “separation of powers” to be so sacrosanct?) and that Harper is trying to get rid of needless overlap of the feds onto provincial jurisdiction by writing bigger and bigger cheques for Health Care?

          It seems to me that one has to be looking through a pretty partisan lens to read McGuinty saying “Why don’t one of us, alone, take responsibility for some of those areas. I think that introduces more efficiencies, it introduces more transparency, accountability is more easily evident. I think those are the kinds of conversations that we need to have going forward in an era of fiscal restraint” and interpret that as a call to weaken the separation of powers. McGuinty is literally calling there for the feds and provinces to sit down and disentangle themselves and start to clean up the morass of overlapping and redundant federal and provincial efforts that make a mockery of the separation of powers, and you’re accusing him of calling for the exact opposite.

    • Hey whatsit, where did Dalton say they’d ignore the constitution? Perhaps you should read what he actually said, and stop reading the inside of your ideological blinders.

  2. If Harper actually wanted to save money in healthcare, it could be done with simple things….like one national drug test centre, and national bulk drug buying.

    Instead he wants to overload the provinces by down-loading, and force them to make unpopular cuts.

    • What is stopping the provinces from doing it amongst themselves?  Why do they need their hands held by the Feds?  

      • The feds kick in money, and the provinces abide by federal rules. That’s why we have the same standards across the country.

        Of course if the feds don’t want to do anything nationally…and everyone is on their own in everything….there is no point in being part of the federation

      •   I’m surprised a fiscal conservative like yourself doesn’t understand the concept of cost savings. 

      • If the feds are currently doing certain things that really should be done by the provinces, and the provinces are doing certain things that really should be done by the feds, and in some cases both levels of government are being almost entirely redundant on certain files, how can the provinces fix that on their own?  

      • Governments often suffer from Not Invented Here syndrome. Jurisdictions will adopt different and incompatible policies and standards for no compelling reason other than self-rule. With a little bit of coordination, there are huge network effects that could be unlocked, not to mention economies of scale. Unfortunately, it is just so damned costly in terms of political capital to harmonize such policies. After 20 years, we still do not have free trade between provinces.

  3. Our current Federal plays politics with every file , every department and every province , collaborating overtly with favourites  like Alberta and  Manitoba.They do not respect the needs of all Canadians and work only to please their Reformatory supporters.

    They actively try to elect Reformatories at all levels of government in Canada  and are always in ‘election’ mode. To me that means they sabotage other governments politicos as they are doing with ‘non-negotiating medicare’, a Canada – wide program that citizens want to provide to all, a service as equal as possible.

    • “They actively try to elect Reformatories at all levels of government in Canada.”

      They actively try to get elected!  The villainy!  The horror!

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    • How can the provinces fix the broken criminal justice system when they are obliged to pay for whatever brand of crazy that comes out of Ottawa?

  5. It would make a lot of sense to eliminate the redundancy’s between the Federal/ Provincial governments. I just hope the provinces are prepared to do more than raise it as a theoretical possibility.

  6. Downloading costs to the level below… another recycled Harrisite approach to governing. That’s what the Harris government did to the municipalities in Ontario; it wasn’t pleasant and it has taken the Libs forever to get things back somewhere close to where they were.

    If you cut taxes, you have no moneyto spend, so you make the other guy pay for it or do without. And then you blame them when it all goes wrong.

    • So should we assume then that you’re in favour of raising taxes?  And if so, which ones do you want raised, and by how much?

      • Raising the GST 2% would be a start.

      • Ideally?  First we make political contributions non-tax deductible.  Then we eliminate pretty all of those boutique non-refundable tax deductions. 
        Then we add a carbon tax.If more is still needed, we raise the GST.If anybody could figure out how, we tax economies of scale, so that simply being able to move massive quantities doesn’t lead to a significant market advantage and small companies can compete on a more level playing field with big guys.Beyond that, we add another tier to the top level of income tax.  45% over 250k or so, which is essentially double the current top tier.

      • As the last line says: “As there is only one taxpayer, Canadians should be aware of this.”

        If we want something, we have to pay for it – one way or another. By downloading, the cost doesn’t go away, it just moves it. In the end, unless you can find a more efficient means of delivery, it means higher taxes or cutting services – period.

        All downloading does is make the government dumping the costs “look” like they are cutting costs, at the expense of the lower level of government, who either has to raise taxes or cut the service – leaving them looking like the bad guys when really the higher level has just made them the fall guys.

        Like I said – a cheap Harrisite sleight-of-hand trick that really accomplishes nothing beyond optics. I want a government that actually does something.

  7. What a crock.  This is the same Mcguinty who was complaining that the feds have left the provinces free to manage health care on their own, and health care is unquestionably in provincial jurisdiction.

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