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Canadian government pours money into provincial health budgets

BMJ 2000; 321 doi: (Published 23 September 2000) Cite this as: BMJ 2000;321:726
  1. David Spurgeon
  1. Quebec

    Pressured by public fears about a failing healthcare system and the anger of provincial premiers, Canada's prime minister, Jean Chrétien, has announced a substantial increase in funding for provincial health budgets.

    The increase, of $C23.4bn (£11bn; $15.6bn) over five years in new federal health and social transfer funds, is intended to go some way to restore the cuts in funding for Medicare, the system that gives comprehensive coverage of approved medical and hospital services for every Canadian. It represents an increase of about 35%.

    The money includes $C2.2bn for “early childhood development,” $C1bn for medical equipment such as magnet resonance imaging scanners, $C500m for improvements in health information technology, $C800m for primary care improvement, and a general cash increase of $C18.9bn.

    The announcement was welcomed by medical and nursing association spokespeople and others, but the premiers warned that even more money would be needed in the future.

    A public opinion poll conducted for the Canadian Medical Association, released just after the announcement, showed that eight out of 10 Canadians rank access to affordable and high quality health care first among their priorities for public programmes. Most believe that healthcare costs will rise sharply, and 83% ranked increased funding for public health care as the preferred option for relieving pressure on the system.

    Provincial governments have responsibility for health and education under Canada's federal system, and the federal government transfers funds to them annually for these purposes. Over the past decade, these transfers have been cut sharply to reduce a huge federal deficit. This year the federal government found itself with a massive budgetary surplus, so the premiers demanded that the transfer funds be restored to previous levels. Besides demanding the money, however, they wanted to ensure they would have control over the transfer funds, as granted in Canada's constitution. But the federal government, which attempts to ensure nationwide standards through the Canada Health Act, as well as providing healthcare services directly for groups such as the armed forces, was unwilling to give up complete control to the provinces.

    The country's two most powerful provinces, Ontario and Quebec, whose political agendas are far apart—Ontario's being conservative and Quebec's separatist—joined forces in opposition to the federal stance at a first ministers' meeting this month.

    Only a compromise by Prime Minister Chrétien resulted in a final agreement. In return, Chrétien demanded an annual reporting system be set up to examine the state of the healthcare system.

    Although this agreement was widely hailed as a possible solution to the healthcare system's problems, not all the new money will go to Medicare. The health and social transfer funds can be used at the provinces' discretion for tertiary education and social services as well as health. It is now up to the provinces to decide what portion will go to Medicare and how best to use it.

    Recent problems have included extreme overcrowding of hospital emergency services, severe shortages of medical and nursing staff, long waiting lists for lifesaving surgical operations, and a lack of sufficient equipment and staff, resulting in patients being sent for treatment to the United States at great expense.

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