Finance Committee on May 17th, 2012

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you.

[The Chair, Conservative, James Rajotte]

Okay. Merci.

Do you want to start, Ms. McLeod?

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Yes.

[The Chair, Conservative, James Rajotte]

For the Conservative round I'll go to Ms. McLeod first.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Thank you, Mr. Chair. I'll share this round.

I only have a brief statement. Again, having lived health care on the other side of the issue, I certainly remember the deputy ministers with the charts showing how health care was moving to 30%, to 40%, to 50% of the budget and onwards to 70%. I think every single province was very concerned with this trend and had done a very good job in terms of looking at how they were going to contain it.

I simply find it quite incredible for people to suggest that 6% increases are cuts. To me, that is pretty basic math in terms of 6% increases being increases. As our provinces have very clearly indicated, they have a desire and a necessity to look at how they're doing business, and there truly are options for the provinces. I think they're really tackling this challenge with all the dedication they can because they recognize it is an issue that needs tackling.

I guess I simply had to make a comment because it's something near and dear to my heart.

I'll turn the floor over to my colleague.

[The Chair, Conservative, James Rajotte]

Ms. Glover, please.

[Shelly Glover, Conservative, Saint Boniface, MB]

Thank you, Mr. Chair.

I want to thank Ms. McLeod. She has a nursing background, so she really does have her heart in the subject.

I'd like to ask you to table something else, Mr. MacDonald. In answer to the several questions repeated by Mr. Caron about the 6%, we've already said that the table you're going to submit shows an average of 3.8% increases, not 6%, which is what the federal government's contribution is going up by. But just to alleviate his concerns, I'd ask you to table not just the averages, but the provinces' budgetary expenses for health care from the year before, because in that case, the average was 4.8%.

Reiterating what you said, Mr. MacDonald, the provinces had already started to make some changes on their own, recognizing they have a large jurisdictional responsibility to ensure health care is sustainable. They too have to make sure that taxpayers and the revenues that come from taxpayers ensure that all Canadians are eligible for what we think is very important: a provincially or a federally funded, publicly funded health care system.

So if you could table that other chart as well, perhaps that would alleviate Mr. Caron's concerns, and he would see very clearly that his position makes no sense.

Thanks.

[The Chair, Conservative, James Rajotte]

Okay.

Mr. Jean, do you have a quick question?

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I wanted to make note of what Mr. Marston said in relation to the PBO report. It is germane to the report that came out today, which did mention on page 3.... Of course the PBO is based on projections, and he said in this report the updated analysis indicated that as a result of the change to the Canada health transfer to grow in line with nominal GDP—which we projected as a government—then of course OAS may be sustainable. But he admits in the report itself that cost pressures are coming on OAS, and he also clarifies it by saying, and I quote: “However, the change to the federal CHT structure is mirrored at the provincial-territorial level. The provincial-territorial long-term fiscal situation has deteriorated.” As a result of that, and as a result frankly of the PBO doing projections and using projections instead of actuals, I quite frankly almost need an interpreter for the paragraph itself on where we are, and whether we're going or coming.

I wanted to make a point of that with Mr. Marston's comments earlier about OAS being sustainable.

[The Chair, Conservative, James Rajotte]

Okay. Thank you.

I have Mr. Brison next.

[Scott Brison, Liberal, Kings—Hants, NS]

Thank you.

I have a question and a comment. It has to do in part with some of the information you've brought to committee, Mr. MacDonald, and also some of what my colleague Mr. Jean has raised.

If you look at the provinces--and Mr. Jean referenced a 7% increase, I believe, in Alberta, and I think a 1% decrease, for instance, in New Brunswick, in round figures--what I find stark about that is that New Brunswick has an aging population. I think Alberta's population is probably getting younger as more young people are moving to Alberta, yet the cost of health care is increasing significantly. If Alberta can afford to do that, I think that's great, but it raises the issue of demographics that I mentioned earlier. Nova Scotia is an example of a province that's teetering on decline in population and certainly has an aging population. We have higher health care costs, and you would agree that the health care costs as people get older tend to increase.

[Daniel MacDonald]

Yes.

[Scott Brison, Liberal, Kings—Hants, NS]

And the tax base has fewer people working.

I'll go back to that question I posed earlier. Is there an initiative or study within Health Canada to evaluate these demographic factors and what their potential impact is or what the public policy response ought to be from a federal government?

[Daniel MacDonald]

I can't speak for the Department of Health on that particular matter.

[Scott Brison, Liberal, Kings—Hants, NS]

In terms of government, you've spoken to us on health care transfers. Is there some discussion within government on this?

[Daniel MacDonald]

In terms of the policy with respect to the CHT as it's expressed in the current arrangement, as was committed starting in 2007, was legislated within the Federal-Provincial Fiscal Arrangements Act, there are two steps: equal cash and tax support for health in all provinces and territories, and starting in 2014-15 equal per capita cash support to all Canadians, regardless of where they live.

[Scott Brison, Liberal, Kings—Hants, NS]

Sure, but--

[Daniel MacDonald]

That's what the bill reads.

[Scott Brison, Liberal, Kings—Hants, NS]

I'm comparing the government's approach, for instance, to the OAS, where ostensibly it's a demographic issue that is rendering OAS in its current form unsustainable, according to the government's arguments. We have a demographic-based sustainability issue, I would posit, in terms of health care. I'm just asking, is there some discussion within the machinery of government on how to address this?

This is a very significant issue. I'm certain that if the government were to sit down with the provinces and have this discussion it would be an important one. Again, all power to Alberta with the ability to have a 7% increase, but for some provinces, particularly those provinces with a declining or stagnant population growth, an aging population, and a resultant lower tax base and higher health care costs, the demographic issue is a very important part of the public policy dialogue we ought to be having.

I'm just asking the question, is there a discourse within government on this?

[Daniel MacDonald]

I think you mentioned.... There was a point I wanted to make earlier about something like demographic change, and a number of things associated with it, which will have different impacts. There's also to be considered the overall transfer package, if you will, the different transfer tools that the federal government has.

You mentioned that another consequence of population aging is the working age, and then into retirement, and the effect that has on the fiscal capacity of a province to raise revenues from that population, for example. You were talking about issues there that are dealt with by the equalization program already. That's the program that deals with fiscal disparities from a number of causes between provinces.

I just point out that there are various tools that the federal government has for addressing various things, and that's one of those effects that would already be captured.

[The Chair, Conservative, James Rajotte]

Okay, thank you.

Mr. Caron, you have the floor.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

If people can make comments, I would like to make one as well.

I don't think there is anyone here denying the fact that the provinces are facing the brunt of a very high part of their budget going to health care. That's a given, and we understand that. We understand the need for restructuring health care as well. That effort is actually not something you can do with a snap of your fingers, saying we're just going to set ceilings. It's a major effort of restructuring, of redoing ways, of rethinking the ways we've been delivering health care in the provinces. The question is, how are we going to do it?

Before the idea was to actually have the federal government working with the provinces to actually try to achieve this change in mind frame, the change in the way of seeing things, and trying to find outside-the-box solutions to actually do it. By saying that we're going to set ceilings, without looking at the way the ceilings will be respected, is actually a problem. Because in the end, the cost of saving money will actually be depriving the system and the citizens of services that they have been receiving.

That's why I was asking the questions about when the decision was made and how the provinces reacted. My point is that the provinces reacted to the decision of the federal government to set that cap. Now they might very well be achieving it, and that's good.

In response to Ms. Glover and the request, I'd like to see that, actually. In the last five or six years.... But the money is not the only thing. If you can actually table this document, I'd like to know how the provinces were able to achieve it. What decisions did they make to do it?

There are some good initiatives that we can fully support, like the one in your hospital, for example. There are some other savings that are achieved by delisting and by basically cutting hospitals and transferring services to the private sector. Citizens are still paying for it; they're not just paying through their taxes but they are paying out of pocket as well.

If you are preparing this list of the growth in health care costs, I'd like to also know how they were achieved. That will have to be part of the document for it to actually encompass the whole situation. You cannot only talk about financial costs without talking about the way citizens are deprived of services or might be receiving services of lower quality than what they were receiving before.

That's the whole point of the line of questioning. I just wanted to set that out.

[The Chair, Conservative, James Rajotte]

Thank you.

Mr. Jean, please.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Thank you, Mr. Chair.

Something that we keep missing here is that this is a provincial responsibility. The province has ultimate control of the administration of health care. What we've heard today is clear evidence that the provinces, on average, are increasing their health care expenditures by somewhere in the neighbourhood of 3.6% to 3.8%, and the federal government, as a funding partner only, is coming forward and saying, here are 6% increases. And we're complaining about it. Well, we're not, but clearly somebody is complaining about it, and we're simply a funding partner. I think what needs to be clear is that it's not a federal responsibility. That is what I would like to say.

I would also like to respond to Mr. Brison's comments in relation to Alberta. It might have something to do with the extreme growth that we've had over the last eight years. I would indicate to him that in my constituency of Fort McMurray, we have the lowest doctor-patient ratio in the country. In fact, I think we're the lowest in the OECD as far as the doctor-patient ratio is concerned. So as far as the delivery of health care services goes, Albertans need the increase, because, frankly, we've had such tremendous growth from your constituency and many other constituencies around the country where people want to get a job and have a great career and live in a great place.

[Scott Brison, Liberal, Kings—Hants, NS]

If we had had the wisdom and foresight and vision—