A Quick Thought On: Health Transfers

Federal Finance Minister Jim Flaherty today told Provincial Finance Ministers that the current 6% increase in health care funding per year from the federal government would end in 2016-2017, at which point the increases will become tied to nominal GPD, but will not be less than 3% (source).

I don’t see anything particularly unreasonable about the move.  Health care costs can’t continue out-pacing inflation forever.  If the transfers grow at a rate that is greater than the rate at which government revenues grow, that means the federal government has less money to spend elsewhere.  Basically, it means money for health care funding has to be produced through funding cuts to other programs (or through tax increases).  At some point, health care costs do have to be reined in.

There is one problem that I have with this, which is that the Conservatives, like the Liberals and the NDP, said during the last federal election that they planned on keeping the 6% annual increase in place.  Now, I think governments generally should be allowed to change their plan as the circumstances change, but given how close this change has come to the election, and given that the country’s financial situation hasn’t changed notably since then, it seems as though what the Conservatives were saying a few months ago was pretty disingenuous.

Perhaps more importantly, throughout the most recent session of Parliament, the Conservatives repeatedly referred to the “mandate” they received to implement their election platform, and have repeatedly used this “mandate” as an excuse to try to rush bills through the House and eliminate opportunities for debate and oversight.  Now, if what the government is doing is implementing the platform that they were given a mandate to implement, shouldn’t they also have kept the 6% health transfer increases in place?  If they’re not sticking tightly to the platform, then the idea of implementing a mandate (and thus the Conservatives’ excuse for stifling Parliamentary oversight) disappears.  They can’t have it both ways; either they’re implementing their mandate or they’re not.