Montreal, February 21, 2017 – In order to improve Canada’s public health care systems, Ottawa should withdraw from this sector and let each province decide for itself the best ways to provide services to its population, argues a Viewpoint published today by the MEI.
Ottawa intends to limit its health transfer increase (to a little over 3% rather than 6%) and force the provinces to spend a portion of this money on specific areas, which has led to a wrestling match between certain provinces and the federal government. When it comes to autonomy, the provinces are right.
“Health care is an area of provincial jurisdiction, and it is provincial governments that must face their electorates and justify their actions. Provincial politicians should be able to make decisions that are contrary to the federal government’s wishes and that would please their voters,” says Germain Belzile, Senior Associate Researcher at the MEI and the author of the publication.
From an economic point of view, this federal interference poses a problem, he notes. Health transfers, with federal conditions attached, make Canada’s public health care systems less efficient. “When the federal government imposes its priorities, it limits potential innovation,” points out Mr. Belzile.
“In contrast, more decentralized health care decisions would introduce additional competition between the provinces, which would favour the sharing of best practices,” explains Mr. Belzile. “Also, by freeing up the fiscal space that it occupies on this issue, making room for the provinces, Ottawa would make local politicians more accountable, and thus more attentive to the wishes of voters in their region.”
Since it is easier to adjust provincial policies to regional differences than to adjust a single national policy, the fact that Ottawa imposes conditions is counterproductive. “Federal Health Minister Jane Philpott was calling recently for a ‘transformation’ of the health care system, noting that it was important ‘to do better, to make sure we get better value for money’,” says Jasmin Guénette, Vice President of the MEI. “Among the best ways to get there is to respect provincial jurisdiction over health care,” he concludes.
The Viewpoint entitled “Why Ottawa Should Respect Provincial Jurisdiction over Health Care” was prepared by Germain Belzile, Senior Associate Researcher at the MEI, in collaboration with Jasmin Guénette, Vice President of the MEI. This publication is available on our website.
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The Montreal Economic Institute is an independent, non-partisan, not-for-profit research and educational organization. Through its studies and its conferences, the MEI stimulates debate on public policies in Quebec and across Canada by proposing wealth-creating reforms based on market mechanisms.
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