Finance Committee on May 7th, 2026

[Ryan Turnbull, Liberal, Whitby, ON]

I want to take up the conversation Ms. Cobena started here.

I know the Canada Growth Fund uses some public investment as seed funding for its pool of capital. It's drawing in private capital, but on concessionary terms. It's explicit in the documents that this is concessionary financing. It's mostly equity, but there's some debt financing in there. The Canada Infrastructure Bank is different as well, with concessionary loans.

My understanding of the sovereign wealth fund is that it will be on commercial terms. It's equity. It's a different tool in the tool box that is unique. Just as the indigenous loan guarantee program enables first nations and indigenous communities to participate in owning equity in major projects, this particular sovereign wealth fund will allow, on commercial terms, the same for everyday Canadians who are able to invest in it.

Mr. Larouche, can you correct me if I'm wrong or confirm what I just outlined as the intention behind the sovereign wealth fund? I think that's been explicit in our documents.

[Thomas Larouche]

Again, it's not my area, so I can't really confirm that, but it is true that these funds have different purposes.

To follow up, we can get back to you in writing with as much detail as we can provide.

[Ryan Turnbull, Liberal, Whitby, ON]

Okay. Thank you very much for that.

I'll pass it back to my colleague Mr. MacDonald.

[Kent MacDonald, Liberal, Cardigan, PE]

Thank you.

The Canada health transfer is a conditional transfer of funds. Can you quickly explain the difference among the transfers that your department handles? Some of them are conditional for the provinces, and some of them have no conditions attached.

[Galen Countryman]

Equalization is completely unconditional. Territorial formula financing is completely unconditional. The Canada health transfer is to uphold the principles of the Canada Health Act. For the Canada social transfer, the legislation requires that provinces and territories have no minimum residency requirements in the delivery of social assistance.

[Kent MacDonald, Liberal, Cardigan, PE]

Is it fair to say that provinces challenged with higher costs in providing health care...? The formula provides 5% increase up to 2028, I believe. The jurisdiction I'm from, Prince Edward Island, claims that its costs are going up 14% a year. There's no balancing act there. They could use those equalization funds to balance that out. That's the way it's designed.

[Galen Countryman]

The purpose of equalization is to allow provinces to provide comparable levels of service at reasonably comparable levels of taxation.

[Kent MacDonald, Liberal, Cardigan, PE]

Is there any way of catching, in particular...? In our world today, the reality is that we have a migratory workforce, especially in regions like Atlantic Canada. We have a lot of workers who go to a province like Alberta, stay there for their productive years, pay tax, increase the balance sheet in Alberta and then return to Atlantic Canada for their retirement. This puts strains on our health care system.

Is there nothing in today's formula that addresses this, other than the equalization part of the transfers?

[Galen Countryman]

No. Again, these are annual transfers and annual calculations, so there's nothing for that lifetime perspective you're speaking about.

[Kent MacDonald, Liberal, Cardigan, PE]

These transfers were designed so that all regions would have equal access to not only health care and social services but also infrastructure. It's important that smaller regions have ports, roads and airports—the whole gamut of things.

We heard earlier that the current formula dates back to 2006. Now, I know it's hard for you to express an opinion, because I heard your answer earlier, but I'm going to put you on the spot again. Do you think it's time to revisit that and look at creating a panel of expert witnesses to come up with an improved formula going forward?

[The Vice-Chair (Jasraj Hallan), Conservative, Jasraj Singh Hallan]

You'll have to answer that in another round. That's time.

Next, we have Mr. Garon for two and a half minutes.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Thank you, Mr. Chair.

Mr. Countryman, could you tell me what will be the nominal increase in the Canada health transfer for the next three years?

[Galen Countryman]

I'm sorry, Mr. Garon. You asked about the rate of increase of what?

[Jean-Denis Garon, Bloc, Mirabel, QC]

Mr. Chair, on a point of order, if possible, there are issues with interpretation. It's happened before, and I want to make you aware of it. Interpretation is taking a long time. In this case, we're up to 25 seconds in delay. That's almost 20% of my time for this round.

Could I start over so I don't lose my speaking time, please?

[Galen Countryman]

So, the question is about the percentage growth rate—

[Jean-Denis Garon, Bloc, Mirabel, QC]

Just a moment, please, Mr. Countryman. We're dealing with the point of order.

[The Vice-Chair (Jasraj Hallan), Conservative, Jasraj Singh Hallan]

Yes, Mr. Garon, we paused your time.

[Jean-Denis Garon, Bloc, Mirabel, QC]

I would therefore start my turn over.

I'll ask my question again to make sure the witness understands it. Is that correct, Mr. Chair?

[The Vice-Chair (Jasraj Hallan), Conservative, Jasraj Singh Hallan]

Definitely.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Thank you very much, Mr. Chair. I really appreciate it.

Mr. Countryman, could you tell me what will be the nominal growth rate, as budgeted to date, of the Canada health transfer, or CHT, for the next three years?

[Galen Countryman]

I don't necessarily have the rates in front of me. However, the growth rate for the CHT for 2026‑27 and for 2027‑28 is 5%. After that, it would follow the nominal GDP growth rate.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Okay. It'll probably be a little bit lower than 5%.

Does the department know the growth rate of average health system costs in Quebec?

[Galen Countryman]

I don't have any figures on the growth rate of the health care system in Quebec.

[Jean-Denis Garon, Bloc, Mirabel, QC]

According to a number of calculations, including academic calculations by HEC Montréal, the growth rate for these costs, based on five major criteria, is over 6%.

Assuming those costs go up by about 6%, would you agree that rates of increase of 5% next year for the transfer, 5% the following year and then a percentage equal to the nominal GDP thereafter could constitute a gradual withdrawal from health care funding by the federal government?

[Galen Countryman]

With these growth rates, the Canada health transfer will continue to increase in a predictable way for provinces and territories.