Looking For Leadership

The provincial premiers have just concluded their annual gathering, now known as the “Council of the Federation.”  The principal activity at these meetings seems to be urging the federal government to change how and where it spends its money.

A long time favourite topic is health, the largest area of provincial expenditure. The constitution of Canada clearly establishes that health is a provincial responsibility. Canadian Medicare was first established by Saskatchewan acting on its own. As the trend spread the federal government became involved, offering to contribute a substantial proportion of the cost to provinces that established programs. Eventually, all of them did.

Subsequently, the federal share of health spending was reduced but it still provides a crucial portion of the funding — in Nova Scotia’s case, 21% in the current year. Over the last three years, federal contribution to health funding to Nova Scotia has increased by 17.3%. The province’s share includes physicians and hospitals plus homecare, long term care, ambulances, pharmacare, etc. It increased by only 7.2%.

The 2004 Health Accord created billions of dollars of new federal funding. A prominent goal of that accord was to reduce wait times in five areas: radiation therapy, bypass surgery, diagnostic imaging, joint replacements, and sight restoration.

In fact performance on these has deteriorated between 2008 and 2012,with only the goal for radiation therapy being met in any province in 2012. Most of the money seems to have gone to improved pay for health care professionals, or to offset reductions in provincial funding — for example, in Nova Scotia.

Nevertheless, Nova Scotia and the other provinces are urging Ottawa to show more “leadership” in establishing and achieving national standards. But leadership is not actually what they are seeking. It is just more money.

Those who are genuinely seeking leadership are by implication willing to be followers. But that is the far from what the provinces intend. It is not just provinces like Alberta and Quebec, fiercely protective of jurisdictional rights, that want the money to arrive with no strings attached.

Likewise, the provinces have criticized the federal commitment of $50 billion to support infrastructure both because of its size and because the federal government wants to be involved in making choices.

A third area of difference is in labour market training. Like health, this is an area clearly in the jurisdiction of the provinces, but one which receives substantial federal funding. The present arrangements will expire in March of 2014.

The new federal proposal would provide up to $5,000 per person and require employers and provinces to each match it. The program is focused on areas of known shortages of trained workers.

The provinces reacted somewhat predictably: “Premiers reiterated that federal funding agreements or initiatives such as the proposed Canada Job Grant must allow jurisdictions to opt out, with full compensation.” In other words, your money is welcome, but not your ideas on how it should be spent.

The federal government apparently wants to have it both ways.

In the case of health, they have provided a clear and fairly generous funding commitment, but would prefer to leave the decisions on how it is spent to the provinces. One can perhaps understand the reluctance to attend meetings where the provinces ask for more “leadership”, by which they mean just send more money.

On-the-job training front the Federal government wants to provide money and to define the program. It is mildly encouraging that Jason Kenney, the new Employment Minister, is willing to discuss how the grant is deployed when he meets with provincial ministers this fall.

The provinces are understandably wary. Dual management does not work, and the provinces can be left with a big problem if the federal government reduces its support to a program they helped establish.

The federal approach to health is the better one. It provides long term sustainable funding without interfering. Provinces should be happier with it, and stop calling for more leadership that they are not planning to follow.


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