Madam Speaker, I am pleased to introduce at second reading an act to amend the Federal-Provincial Fiscal Arrangements Act and to enact an act respecting the provision of funding for diagnostic and medical equipment. It is a very long name, possibly befitting the enormous sums of money involved and the importance of this agreement to all Canadians.
Canadians have told their governments that health care is of primary importance to them. As such, they have asked governments to work together to strengthen the health care system, to improve access to essential services and to reduce the wait times.
Canadians want to ensure the health care system is there for them today and sustainable for future generations. Governments are working to meet those expectations.
In September 2004 all first ministers signed a 10 year plan to strengthen health care. In support of the 10 year plan, the Government of Canada committed to increase its transfer to provinces and territories for health by the sum of $41 billion over 10 years starting in this fiscal year 2004-05. The increased funding of $41 billion will do three important things.
First, it will strengthen the Canada health transfer, the largest federal transfer supporting health care. It will both increase the base level of the transfer and establish an automatic 6% escalator, which is an unprecedented move to ensure predictable and stable growth in the federal transfer support.
Second, it will create a wait times reduction transfer to assist provinces and territories in reducing wait times according to their respective priorities.
Third, the new federal funding will provide an additional $500 million to provinces and territories for diagnostic and medical equipment, helping to improve access to publicly funded diagnostic services. The commitment to provide an additional $41 billion to provinces and territories will help ensure that current and future generations of Canadians have timely access to essential quality health care across the country.
At the September 2004 meeting of first ministers, a broad consensus emerged between governments on a shared agenda renewal of health care in Canada. That agenda focused on ensuring that Canadians have access to the care they need when they need it. As a result, federal, provincial and territorial governments agreed upon an action plan to ensure viable health care for Canadians setting out commitments to improve access and to reduce wait times.
The federal government is committed to doing its part to support the needed renewal and reform of health care. As part of its contribution to an effective working partnership on health care, the federal government brings a commitment to a growing, stable and predictable health care funding so that provinces and territories can plan for the future.
The bill before us today would provide for new federal funding over the next 10 years in support of the agreement signed by the first ministers on health.
To that end, the Government of Canada commits $41 billion in new federal funding over 10 years to meet those goals set out in that 10 year plan. Bill C-39 would implement those funding commitments.
To accelerate and broaden health care renewal and reform, the federal government will take a number of steps to strengthen the Canada health transfer, otherwise known as the CHT. It will invest an additional $3 billion in CHT in 2004-05 and 2005-6 to close the so-called Romanow gap.
A second important initiative is establishing a new, higher base for the Canada health transfer beginning in 2005-06. In that year the new CHT base will be $19 billion.
This commitment fully satisfies and in fact exceeds the recommendations made in the Romanow report on the future of health care in Canada. That new and higher base of $19 billion includes $500 million in targeted funding for home care and catastrophic drug coverage, clear priorities to many Canadians.
This funding for home care and catastrophic drug coverage recognizes and supports the first ministers' commitments to improve access to home and community care services and catastrophic drug coverage. These commitments are important to improving the quality of life of many Canadians and to ensure that no Canadian suffers undue financial hardship in accessing needed drug therapies.
Also of note, the health reform transfer created as part of the 2003 accord is now being rolled into the CHT effective 2005-06 and beyond. This consolidation of federal support for health reflects the continuing commitment to enhanced transparency and accountability and to support reforms established in the 2003 accord, including primary care, home care and catastrophic drug coverage.
To ensure predictable and sustainable growth in health care funding through the CHT, the government has committed to legislate an automatic escalator. An automatic escalator of 6% will be applied to the new health care transfer base of $19 billion effective in the fiscal year 2006-07.
This rate of growth is higher than the projected rate of nominal GDP growth, the rate of growth of the Canadian economy and, therefore, growth in total federal revenues over the periods 2006-07 to 2013-14. This rate of growth is fully consistent with the recommendations of the Romanow report. In other words, the federal government has agreed to increase the funding to CHT faster than the economy will grow and faster than we anticipate that federal revenues will be realized.
Foremost in the 10 year plan is the need to make timely access to quality care a reality for Canadians. The government remains committed to the dual objectives of better management of wait times and measurable reduction of wait times where they are longer than medically acceptable. All jurisdictions have taken concrete steps to address wait times, particularly in such priority areas as cancer, cardiac care and diagnostic imaging. The bill provides for an investment of the Government of Canada of $5.5 billion over 10 years in wait times reduction transfer.
Funding of $4.25 billion will be provided through a third party trust and accounted for by the Government of Canada in 2004-05. The government recognizes that not all provinces and territories are at the same stage in implementing their wait time reduction strategies. Provinces and territories will now have the flexibility to draw down funding according to their respective jurisdictional priorities to meet their wait time reduction commitments.
This funding will primarily be used for priorities identified by each jurisdiction. These priorities include: clearing backlogs, training and hiring more health care professionals, building capacity for regional centres of excellence, and expanding appropriate ambulatory and community care programs and tools to manage wait times.
Beginning in the fiscal year 2009-10, $250 million will be provided through an annual transfer to provinces and territories in support of health human resources and tools to manage wait times.
The government will also provide to provinces and territories a further $500 million for medical equipment in 2004-05. Building on previous investments in diagnostic and medical equipment under the 2000 and 2003 health accords, this funding will assist provinces and territories in improving access to publicly funded diagnostic services by providing funding for new equipment and the related specialized staff training that is required to operate this new equipment.
The $500 million more than fulfills the government's commitment that additional revenues from the goods and services tax as a result of the spike in gasoline taxes would be redirected toward further investments in medical equipment on a one time basis.
As a result of these commitments, total federal cash transfers in support of health are scheduled to rise to $30.5 billion in the years 2013-14 from $16.3 billion in 2004-05. The bulk of this new funding is being provided through the Canada health transfer, which will grow by 6% annually from its new base of $19 billion in 2005-06 to nearly $30.3 billion in the year 2014. This represents a significant and continuing federal investment in the Canadian health care system.
In addition, all funding will be distributed to provinces and territories on an equal per capita basis in order to ensure equal support for all Canadians regardless of their place of residence.
The new federal support of $41 billion for 10 years builds on previous federal investments in provincial and territorial health care achieved under the 2000 agreement on health and the 2003 first ministers accord on health renewal.
In September 2000 first ministers agreed to an action plan for health care renewal. In support of the first ministers agreement for health, the federal government invested an additional $23.4 billion through the Canada health and social transfer to accelerate and broaden health renewal and reform.
Drawing on the 2000 framework supporting reform and renewal, in February 2003 the first ministers accord on health care renewal set out a plan for reforms to improve access to quality health care for Canadians. Building on the significant investments in 2000, the federal government provided $36.8 billion in support of the initiatives outlined in the 2003 accord.
In addition to increased federal financial support, the first ministers also agreed in the 2003 accord that the sustained renewal of Canada's health care system required structural change. That is why they agreed to restructure the Canada health and social transfer into two separate transfers: the Canada health transfer and the Canada social transfer.
The Canada health transfer was designed to provide growing and predictable support for health. It also improves the transparency and accountability of the Government of Canada's support for health. And through the new CST, provinces and territories have continued flexibility to allocate federal funding for post-secondary education, social assistance and social services, including child care programs, according to their respective priorities.
In addition, these transfers meet the recommendation in the Romanow report for the creation of a dedicated cash transfer for health.
These measures contained in the 2000 and 2003 accords provide a predictable, sustainable and growing long term funding and planning framework for transfers to the provinces and territories in support of health care.
The new funding of $41 billion in the 10 year plan builds on the significant federal investments in health care in the 2000 and 2003 accords. This new funding confirms the government's commitment to making major reinvestments in health a clear priority for Canadians.
Improving our health care system is not just about money. It is about results. All orders of government remain committed to an action plan that achieves results. As such, first ministers recognize that making health care sustainable and able to adapt to the ever-changing needs of Canadians will take time, sustained commitment and adequate resources.
Under the 10 year plan, the governments agreed to report to their residents on health system performance, including the elements outlined in the communiqué of September 16, 2004. In fulfillment of its commitment to Canadians, recognizing that it has authorized significant new expenditures of Canadian taxpayers' money, Bill C-39 includes a provision for parliamentary review of progress in implementing the 10 year plan.
As the hon. members know, at the first ministers meeting this past October, the Government of Canada announced fundamental changes to Canada's equalization program and territorial financing formula. These changes will bring stability, predictability and growth to the overall level of funding for these programs.
Bill C-24, currently before Parliament and just reintroduced into Parliament from the finance committee as of this morning, sets out a new $33 billion framework for equalization and territorial formula financing. When combined with the $41 billion health accord, these investments will total a cumulative increase of $74 billion in new money transferred from the federal government to the provinces and territories over the next 10 years. This illustrates the government's commitment to ensuring that all provinces and all territories can offer the best possible services to their citizens.
In summary, Canadians have told their governments, year after year, to work together to ensure that our health system will be there for them and their children. Governments have responded.
On September 16, 2004, all the first ministers signed the 10 year plan to strengthen health care. As stated in the Speech from the Throne of October 5, 2004, “the Plan sets out a clear commitment, shared by all provinces and territories to achieve tangible results--results for patients”.
The 10 year plan provides $41 billion in new federal funding in support of these commitments. This is new funding that goes directly to provinces and territories in support of health care services that Canadians need.
The funding strengthens core support for health care and the principles of the Canada Health Act through increases to the Canada health transfer. It helps provinces and territories reduce wait times through the targeted wait times reduction transfer, and it provides additional funding for diagnostic and medical equipment.
The federal government has confirmed its commitment to health care reform and renewal through the tabling of this legislation to implement the funding commitments of the 10 year plan and provide growing and predictable transfer support for provinces and territories.
The $41 billion in increased federal investment represents the firm commitment of the Government of Canada toward ensuring the sustainability of the health care system and that all Canadians have access to essential health services when they need them.
Hon. members can no doubt appreciate the importance of passing the bill in a timely fashion so that provinces and territories can have access to the 2004-05 funding and begin to plan for future programs. I therefore urge all hon. members to support the speedy passage of the bill.