You might have seen this little blurb in the Toronto Star about Tommy Douglas’s daughter claiming that Stephen Harper is eroding the health care system. She reportedly said that while Harper would never admit he’s against the system, the evidence shows that the system is “being starved to death.”
First of all, let’s get some facts straight on this story. Total spending on health care in Canada reached roughly $191.6 billion in 2010, up by $9.5 billion (5.2 per cent) from 2009, according the Canadian Institute for Health Information. This represented a year-over-year increase of $216 per Canadian, bringing total health expenditure per capita to an estimated $5,614. As recently as 2008, Canada was fifth in the OECD for health care spending per capita.
When Tommy Douglas’s vision of Medicare was brought into being in 1962 by Woodrow Lloyd, the federal government offered a plan to fund 50 per cent of hospital costs. By 1966 that became a 50-50 arrangement between the federal government and the provinces. Since that time, and most notably during the Liberal majority governments during the 90s, health care transfer payments has dropped to about 16 per cent.
Spending as a per cent of GDP increased most between 1975 and 1992, rising from seven to 10 per cent in that time. Liberal cutbacks and changes to provincial transfer payments, particularly with the creation of the confusing Canada Health and Social Transfer system in 1996, resulted in a decline in spending.
Put into historical perspective, Pierre Trudeau’s Liberal government in 1975 spent $12.2 billion on health care, or roughly $527 per person. In Brian Mulroney’s second year in office that number had increased to $49.8 billion ($1,541.70). At the Liberal handover of power in 2005, total health care spending was $140 billion ($4,333.30). So in just four years the Harper government has increased year-over-year spending by $10.32 billion, or an additional $1,280.70 for every man, woman and child in Canada.
I’m far from one to defend Stephen Harper’s spending habits, but it would seem to me that 27 per cent increase to the total health care spending in Canada over five years is a rather significant improvement, and far from being “starved to death.” Starving the system would have been to increase spending by a nominal increase in the inflationary adjustments.
Let’s not forget that the Canada Health Act is very clear in keeping health care a provincial jurisdiction. How the provinces manage their money is entirely up to the financial responsibility of the provincial leadership at the time. In 2007, the largest cost of health care spending was in hospital costs, eating 28.6 per cent of the whole; physician salaries took up 13.1 per cent; and prescription drugs accounted for 16.5 per cent.
According to the 2010 federal budget, $24.8 billion went to the provinces in the form of health transfer payments, second only to social security. An additional $2.9 billion was transferred in provincial program expenses. (It might be worthy to note that Canada spent $20.9 billion on national defence).
Health care spending accounts for between 37 per cent to 50 per cent of provincial budgets now, and that number continues to rise as the provinces depend on larger transfer payments from Ottawa. The logical solution, then, would be to amend the Canada Health Act to allow for a more flexible delivery of health care at the provincial level and remove the dependence on the federal government to control the problem.
