Mr. Speaker, first I would like to mention that I will be splitting my time with the hon. member for Etobicoke North.
I truly appreciate the opportunity this debate offers to join with my colleagues in re-enforcing our government’s absolute commitment to the quality health care that has become a fundamental part of our national values and heritage.
Improving our health care system is the number one priority of Canadians and their government. I am just back from a prebudget consultation tour and that is what we were told everywhere. Canadians everywhere want to see real, practical and measurable progress on improving access to health care services and reducing wait times.
Clearly, now is the time for governments to stop pointing fingers and start working toward sustainable solutions for the Canadian health care system.
There is no question that people are deeply concerned about the challenges, including the cost, that confront the health care system.
This government has a concrete priority to work through partnerships with all orders of government and all stakeholders to provide Canadians in every region with the public health care system they need and rely on.
This is not rhetoric. We have backed that priority with real action and bottom line results.
For example, almost 80 per cent of all the new federal spending initiatives we have undertaken since balancing the books have been in just three areas: health care, education and innovation.
Indeed, just last year, the federal government announced increases in funding under the 2003 Accord on Health Care Renewal alone totalling $34.8 billion over 5 years.
A large part of these funds will increase the Canada Health and Social Transfer, or CHST, and will be available to provinces to use on health care, post-secondary education, social programs and early childhood development.
Of the $34.8 billion, $29.5 billion goes to provinces and territories through increased transfers. It comes down to this:$16 billion over five year for the health reform transfer; $12 billion through the CHST and its successor programs; the $2.5 billion 2003 CHST cash supplement; and $1.5 billion for the diagnostic and medical equipment fund.
The health reform transfer provides $16 billion over five years for the provinces and territories to target primary care, home care and catastrophic drug coverage.
Now let us turn to the CHST which is intended to support health, social security and post-secondary education. Since health spending represents about 62% of the total that provinces spend in those three areas, it is reasonable to assume that, on average, 62% of the $38 billion that the government is providing this year would be spent on health. I think it is a fair assumption.
That’s more than $23 billion of the annual CHST transfer. Adding in the $1 billion in support from the new health reform transfer and $500 million in the diagnostic and medical equipment fund increases this amount to over $24 billion just this year.
And again, this is only part of the federal health care funding story.
The federal government provides 8 of the 10 provinces with equalization, and they are free to allocate as much of this money to health as they choose. Quebec, for instance, is getting around $4 billion. So, we are talking about a lot of money.
We know that the equalization-receiving provinces spend this money on health care because they tell us so themselves—when equalization payments fluctuate due to changes in provincial economies, the provinces are quick to point out that lower equalization payments mean fewer health care services for their residents.
Equalization is not targeted just to social spending, so let us look at all provincial program spending in order to determine a reasonable amount.
On average, provinces spend about 38% of their program budgets on health care. It is reasonable to assume 38% of annual equalization goes to health, which means about $3 billion a year for health care.
Added to the more than $24 billion in federal support through the CHST and health reform transfer, this brings the federal contribution to approximately $28 billion, or 35% of provincial health care spending.
The real question, of course, is: how does this fit in with provincial health care spending? And the answer may surprise you.
In 2003-04, the provinces spent $78 billion on health care. And, as I have demonstrated, federal transfer funding that can be related to health care is $28 billion. In other words, we actually funded about 35 per cent of provincial health care spending, more than one-third.
It is important to note that, because we are working with national averages, the actual share varies from province to province, because of their different spending on health care and the fact that not all provinces receive equalization.
But, maybe the member opposite can explain how the federal government only funds 16% of health care in his province, when federal transfers this year are estimated to account for about 23 per cent of Quebec’s revenues.
In summary, federal transfers currently cover over one-third of provincial health care costs, but we also have to recognize that federal support for health care extends beyond transfers to the provinces.
There is also direct federal spending for health care. The federal government’s direct spending for health care is estimated at approximately $5 billion in 2003-04.
This spending funds such important initiatives as first nations health, veterans’ health, health protection, disease prevention, health information and health-related research.
Furthermore, through the tax system, the federal government provides support worth about $1 billion a year. This includes credits for medical expenses, disability, caregivers and infirm dependants.
When you add the over $6 billion in direct spending and tax credits to $28 billion in transfers to provinces, which we talked about earlier, the federal government is providing about $34 billion a year, about 40% of all national public spending on health care in Canada.
And this amount will continue to grow following recent investment outlined in the 2003 budget. I think the bottom line here is pretty clear.
Still, let us continue to build on a positive partnership so that taxpayers can get good value for their money. It is always the same taxpayers who contribute at the municipal, provincial and federal levels, and they are asking their elected officials to agree with each other. Let us go in this direction.