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Prime Minister Paul Martin unveiled his healthcare platform yesterday. It was billed as a generational plan for Canadian Medicare.
But the Liberal plan turns out to be little more than a numbers game -- and Martin still falls $700 million short of closing the Romanow gap.
Let's get right to the Enron-style numbers. Until recently healthcare payments to the provinces were made through the Canada Health and Social Transfer (CHST) which is now being split into the Canada Health Transfer (CHT) and the Canada Social Transfer (CST). While the CHT goes to healthcare, the CST provides funding for programs such as higher education, training and early childhood development.
The breakdown is shown below:
Transfer ($ |
2002 |
2003 |
2004 |
2005 |
2006 |
2007 |
Total |
19.1 |
22.7 |
25.6 |
28.7 |
---- |
---- |
Health |
11.8 |
14.4 |
17.3 |
20.3 |
---- |
---- |
Social |
7.3 |
8.3 |
8.3 |
8.4 |
8.5 |
8.8 |
Martin is using an accounting trick to pad healthcare funding while freezing social transfers to make up for lost revenue. While federal transfers for healthcare will increase, provinces will have to siphon off money from their own healthcare budgets to make up for lost social transfers.
Splitting federal funding into dedicated transfers isn't, in and of itself, a bad idea -- Roy Romanow recommended it. But Martin is using this split to make it appear as though he's meeting Romanow's targets without actually injecting enough new money to do so.
Not only that, but with provincial healthcare costs reaching $84.1 billion by 2005, Martin comes up $700 million short in meeting Romanow targets even with his tricky accounting.
For Martin's plan to work as he describes spending on provincial social programs would have to increase by less than 1.5% over the next four years.
So, soon enough we'll be back here -- looking for a generational fix for everything else.
Note: The data in the table above comes from several sources. Health transfer projections came from Martin healthcare plan documents. Social transfer projections from Martin's 2004 budget (page 92). The portion of the CHST dedicated to social transfers in 2002 and 2003 was derive from the budget using the Martin finance department's claim that 38% of CHST funds are spent on programs other than Medicare. Estimates for total provincial healthcare spending were found here (pdf).
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