Meet the new health-care deal… same as the old health-care deal Ottawa claims agreement means more control over provinces’ spending choices, but the Constitution disagrees

The federal government’s claim it will have more say over how the provinces spend money on health care is mostly political fiction.

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The federal government’s claim it will have more say over how the provinces spend money on health care is mostly political fiction.

Prime Minister Justin Trudeau is lauding a new health-care funding agreement announced Tuesday that would see $196 billion transferred to the provinces over 10 years. About a quarter of that amount is new money. It’s not as much as the premiers wanted, but they’ll take it.

Most of the new cash will come through the Canada Health Transfer, which provinces can spend on anything they want. The rest will be earmarked for “priority areas,” which is supposed to give the federal government some input into where provinces allocate their health-care dollars. It won’t.

The only real conditions provincial governments must follow to receive federal funding are those found in the Canada Health Act which, among things, demands that insured services are universal and free to Canadians. Outside of that, the federal government has no say whatsoever in how provinces spend health-care dollars.


Ottawa cannot direct how much provinces spend overall on health care, nor can it micromanage provincial health-care budgets. If a province wants to cut grants to hospitals, as the Progressive Conservative government in Manitoba did (even as it received increases in federal health-care funding), there’s nothing Ottawa can do about it.

Even if the federal government set benchmarks for things such as wait times, it couldn’t cut funding if a province fell short of those targets. It would do more harm than good and would be politically unpalatable.

The same goes for demands under the new funding deal that provinces must commit to better health-care data collection. There are no financial penalties for failing to do so and there is little in the way of specific requirements.

The biggest gimmick in the new deal is the federal government’s desire to negotiate bilateral funding agreements with the provinces. It’s a continuation of what Ottawa has been doing for the past few years. The idea is to sign agreements with individual provinces in areas that include mental health and primary care. The side deals are designed to create the illusion that the government is forcing provinces to spend money in areas that will improve outcomes.

The provinces already spend money in those areas. Any additional “targeted” federal funding will simply be used to cover cost increases in those budget lines, which frees up money in other parts of provincial budgets (to be used for whatever a province wants, such as tax cuts). It’s mostly a shell game. But it’s one the provinces are happy to play along with, as long as they get more federal money.

As Quebec Premier Francois Legault said Tuesday, if Ottawa’s funding demands align with the province’s existing priorities, he’s willing to sign any new deal. “If we have the flexibility with the federal money to be able to finance what we want to finance, we’ll be happy,” he said.

That pretty much says it all.

Federal politicians don’t want to be perceived as mere brokers of money. They want political credit for the money they send to the provinces. Handing over block funding once a year for health care doesn’t cut it. They want multiple news conferences throughout the year announcing specific spending initiatives. Politicians want to cut ribbons.

There are no new, innovative ways of delivering health care and no change in how it is administered or funded.

For the most part, that’s what this new agreement is about. It includes a significant overall funding increase, which is a good thing. There will be more money to spend on hospitals, primary care, home care and long-term care. But the rest is window dressing. There are no new, innovative ways of delivering health care and no change in how it is administered or funded.

That’s how the constitutional division of powers works in Canada. There’s not much the federal government can do about it, beyond enforcing the Canada Health Act. Even then, Ottawa is hesitant to take that too far for fear of interfering in provincial jurisdiction.

Canada doesn’t have a national health-care system. It has 13 provincial and territorial systems that are controlled almost entirely by regional governments. That structure will remain in place as long as health care is a provincial responsibility under the Constitution.

The new agreement will have no impact on that whatsoever.

Tom Brodbeck

Tom Brodbeck

Tom has been covering Manitoba politics since the early 1990s and joined the Winnipeg Free Press news team in 2019.

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