Mr. Speaker, it is a great pleasure to rise and speak on Bill C-18 here today and to join in this debate.
As we know and as has been stated in the House, Bill C-18 really has two aspects that will be dealt with, one aspect being the continuation of the transfer payments from the federal government to the provinces. The second aspect of this bill will allow the federal government to move the $2 billion that has been identified through the meetings with the federal officials and the Prime Minister, through the premiers to the provinces as well, specifically for health care.
We will look first at the aspect of the legislation that deals with the transfer payments. As we are aware, money flows from the federal government through the provinces in any number of ways. Four main vehicles that the federal government uses to share money with the provinces are: the Canada health and social transfer, equalization, the territorial formula financing, and the health reform transfer. The legislation being put forth today deals with equalization and the CHST.
The equalization program basically ensures that those provinces less able to provide the necessities and the essential services to its constituents are able to draw from the fund. It takes into account the revenues from the prosperous provinces. Everybody pays into equalization and then through the sharing formula it is determined which revenues are able to be taken out of this pot. It is a very complex and complicated five province formula that is applied. Through this formula, the lesser provinces, the provinces less apt to have revenues to provide basic services, are able to draw from that fund. I hold my seat in Bras d'Or--Cape Breton and the Province of Nova Scotia is one of those provinces that is a beneficiary of the equalization payments.
Some of the major inputs obviously come from the bigger provinces. When we look at a province like Ontario, we see that its revenue input is a significant amount of what we base our sharing outcomes on. Looking back and reflecting on the year that Ontario has just gone through, there is going to be somewhat of a change from past years because of the tough year Ontario experienced this year with SARS, the downturn in its tourism industry, and those struggles. This is all going to factor into the formula as well.
The original legislation was signed in 1999. As we know, the reason for the discussion, the debate and this legislation coming forward today is that it is set to lapse at the end of March. Hence, we find ourselves in a situation where the federal government wants to guarantee that the flow of cash to the provinces is not interrupted. We want to reaffirm that.
In effect, this legislation is almost like an insurance policy. Officials for the provinces and the federal government continue to negotiate and get into the nitty-gritty of the new legislation that will be put forward. What we will see, hopefully in the next short while, is that a new formula will be developed or a new agreement will be struck. At that time, legislation will be put forward which will supersede today's legislation. This is almost like interim legislation until the new deal is agreed upon between the federal government and the provinces.
The second aspect or component of this legislation is the transfer to the provinces of the very much needed health care dollars. In January, when the Prime Minister met with the premiers, and even before that, it was identified that if there were a surplus then an additional $2 billion would come from the federal coffers to be shared among the provinces.
I remember the great excitement among the premiers and some of the trepidation when we were not quite certain just what the surplus was going to be this year. We had hoped that we were going to be able to provide that $2 billion and now this legislation will make sure that the $2 billion is there and can be moved to the provinces so that they can apply it to their provincial health care systems.
Here is what we have seen in recent years. In September 2000 a reinvestment was made, with $21.5 billion reinvested in health care to the provinces. That agreement was struck between the federal government and the provinces. The federal government, because it finally got its financial house in order, was in a position where it could reinvest in those essentials that Canadians see as imperative. Obviously health care is something that Canadians take a great deal of interest in and recognize the importance of, and fortunately the federal government was able to reinvest in it in 2000. Subsequently, we have made additional investments in health care.
In my own province of Nova Scotia, when we did make the reinvestment in 2000, there was a particular envelope of money that was peeled out and identified specifically for the acquisition of hospital equipment. We can see that on the ground now back in my own constituency. I look at the Cape Breton regional health care facility, the Cape Breton Regional Hospital, and the recent acquisition of an MRI machine.
Before we made this investment in health care back in 2000, I think there were around 50 MRIs in the country. Right now we have almost 125 MRIs across Canada.
There was further investment in equipment. We have digital x-ray machines in Inverness County, in Richmond County at the Strait Richmond Hospital, and a bone densitometer in Sydney. Health care facilities were able to make these investments because the federal government put money in a specific envelope for the acquisition of health care equipment.
People who used to have to leave home and travel to Halifax for these particular treatments are now able to stay in their own communities and receive the treatments. We were very fortunate that we were able to apply the money there.
And really, what we are able to do through this legislation is provide an additional $2 billion that we will be able to transfer to the provinces for health care. It is entirely up to the provinces how they deal with the moneys through the CHST and through equalization.
We hope that the House will see the wisdom of supporting this legislation. We hope members recognize that when we look at equalization, this legislation offers itself as an insurance policy as we wait for the final agreement between the feds and the provinces. As well, we hope they see the merit in supporting this legislation because it will enable the federal government to get that $2 billion into the hands of the provinces so that we can make that reinvestment in our provincial health care programs.