February 8, 2012
- At the July 2011 Council of the Federation (COF) summer meeting in Vancouver, Premiers agreed to meet again early in the new year on an integrated approach to sustainable health. In anticipation of renegotiating major federal transfer funding with the federal government, Premiers agreed to work together on identifying key principles that should govern a new agreement on health care. Discussions were to focus on innovations to modernize health care services that would bring savings to be reinvested in health care systems.
- In December, a Federal/Provincial/Territorial Ministers of Finance meeting took place in Victoria. In an unexpected announcement, Federal Finance Minister Jim Flaherty announced the terms of federal transfer renewal following the expiration of the current legislation in 2014. This included the Canada Health Transfer (CHT), Canada Social Transfer (CST), Equalization and Territorial Formula Financing (TFF).
- The federal announcement provides the GNWT with the assurance that its major transfers will not be cut for the next 7 years.
- The TFF is almost 80 per cent of total GNWT revenues and the 5-year extension of the current formula will provide stable and predictable funding. Technical work will continue to 2013.
- The NWT will benefit from the move to an equal per capita CHT cash allocation beginning in 2014-15.
- Funding under the CHT is determined by use of a formula.
- Funding under the current program is a combination of tax points and cash.
- Jurisdictions such as Alberta and Northwest Territories with higher personal and corporate incomes have higher tax points and, therefore, receive a lower per capita cash component than other provinces and territories.
- In 2011-12 for example, the NWT will receive $643 per capita (per person) under CHT.
- Starting in 2014, the formula for allocating the CHT will move from a combination of tax points and cash allocation to a strictly equal per capita cash allocation.
- This will result in the NWT receiving $783 per capita (per person) under CHT.
- It is projected (based on 2012-13 information) that this will provide the NWT with approximately $6 million more under the new CHT allocation.
- This move to equal per capita cash CHT allocation only benefits Alberta and the NWT (in excess of $6 million more a year).
- Because the CHT transfer is a fixed amount each year Alberta’s and the NWT’s gains under the new formula come at the expense of other jurisdictions.
- While the NWT will receive more CHT under the new formula, per capita transfers do not work for the NWT because of the small population and higher costs of delivering programs and services
- COF met on January 16-17, 2012 in Victoria.
- Premiers demonstrated their commitment to working together to find solutions to common issues that work to the benefit of all Canadians.
- The outcomes of COF meetings are as follows (Communiqués attached):
Health Care Innovation Working Group
- Premiers appointed Prince Edward Island Premier Ghiz and Saskatchewan Premier Wall to co-chair a Health Care Innovation Working Group composed of all provincial and territorial health ministers to drive a collaborative process for transformation and innovation to help ensure the sustainable delivery of health care services.
- The Health Care Innovation Working Group will seek to enhance provincial/territorial capacity to meet new challenges in health care systems, including the needs of seniors, patients with chronic diseases and Northern populations.
- In consultation with health care providers, the working group will focus on scope of practice, human resource management and clinical practice guidelines
- The working group will provide their first report at the July 2012 COF meeting in Halifax.
Working Group on Fiscal Arrangements
- Premiers appointed Manitoba Premier Selinger to lead a working group composed of provincial and territorial finance ministers who will assess the impact of the recently announced federal transfer renewal.
- The formation of this working group will ensure Premiers have all the relevant information on the effect on each jurisdiction of moving to equal per capita cash allocation for CHT.
- Premiers are collectively committed to working to ensure that no jurisdiction should be negatively impacted by the new allocation.
Growing the Economy
- Premiers emphasized the importance of growing the Canadian economy and focused on key actions to enhance prosperity