OTTAWA — Provincial ministers are criticizing what they describe as a lacklustre take-it-or-leave-it offer delivered by the Trudeau government ahead of what have become increasingly bitter talks around federal health-care funding.
Several provinces insisted Sunday that a proposal by the federal Liberals on health funding was presented as an ultimatum — even though they maintain there hadn't been any real negotiations.
On top of that, the provincial ministers argue that Ottawa's latest offer would likely leave provincial health budgets in an even worse financial situation than if the Liberals allow health transfers to fall, as planned, and proceed with what they had promised in their 2015 campaign platform.
Federal Finance Minister Bill Morneau said late Sunday that he hoped the provinces would have an open mind heading into the discussions.
Provincial and territorial finance ministers were expected to turn up the pressure when they sat down for a working dinner Sunday with Morneau. Talks were to continue Monday and health ministers from across the country were expected to join in during a special afternoon session.
Two sides far apart
Morneau has said he's "cautiously optimistic" that an agreement could be reached and, on his way into Sunday's dinner, he told reporters that Ottawa planned to put forward an important idea focused on mental health and home care.
The two sides, however, appeared to be far apart late Sunday.
"I can talk for everyone across the country — we're not satisfied with the way things are conducted," Quebec Health Minister Gaetan Barrette said Sunday in an interview.
"There's been no negotiations whatsoever during the last year and we are being served an ultimatum by Bill Morneau, which is totally insulting and inappropriate...
"Unless he proposes something better than what he put on the table, things are going to be very bad tomorrow."
When asked Sunday about the provinces' claims that Ottawa hadn't presented a good deal, Morneau responded by saying the federal government would like to ensure the talks lead to measurable outcomes "that will make a real difference for Canadians," particularly in mental health and home care.
Even as provincial finance ministers started travelling to the capital Sunday to push for more federal support, the Trudeau government showed no signs it was prepared to budge on its plan to clamp down on increases to health-transfer payments.
"There's been no negotiations whatsoever during the last year and we are being served an ultimatum by Bill Morneau, which is totally insulting and inappropriate..." — Gaetan Barrette, Quebec health minister
The federal Finance Department released figures Sunday showing that the Liberals were banking on just a three per cent increase in health care funding in 2017-18, far below what provinces and territories are requesting. In all, the numbers revealed that Ottawa intended to provide $37.15 billion next year in health transfers, up from the almost $36.1 billion in payments this year.
Ottawa has publicly said it plans to stick with a plan set by the previous Conservative government to see the six per cent annual increase in federal health funding fall to three per cent. Morneau has said that the federal government would put a "significant" amount of money into specific areas such as home care and mental health over a period longer than five years.
However, several provinces say that Morneau made them an offer Friday morning.
Home care and mental health could get additional funds in years to come
Barrette and British Columbia Finance Minister Michael de Jong said Morneau has proposed a firm 3.5 per cent annual increase in transfers as well as another $8 billion over 10 years for specific areas such as home care and mental health. Ottawa is also talking about investing $1 billion into home-care infrastructure over four years, Barrette said.
The offer, de Jong said in an interview Sunday, could mean even less money for provinces over the next decade compared to just leaving the Liberals to follow through on their plan to invest $3 billion over four years into home care and to allow the six per cent annual increase in transfers fall to a floor of either three per cent or an average of nominal economic growth — whichever is higher.
de Jong noted that the federal government's own projections predict that nominal growth will average above 3.5 per cent over the next decade.
"A clever proposal but not one that really addresses the pressures and a disappointment for us," de Jong said in an interview.
Even including the Liberal platform's pledge of $3 billion over four years for home care, de Jong said he didn't think his province would be better off.
He also voiced concerns about the way he says the offer was delivered.
"The take it or leave it attitude that seems to be emanating from the Prime Minister's Office on this is not productive, it's certainly not collaborative, and really not acceptable," de Jong said.
"That's disappointing. It's certainly a departure from what the prime minister indicated in terms of the approach he wanted to take."
"The take it or leave it attitude that seems to be emanating from the Prime Minister's Office on this is not productive" — Michael de Jong, B.C. health minister
Barrette said if the provinces accept Morneau's offer of a locked-in 3.5 per cent annual increases then the federal share of health funding will actually decrease from about 23 per cent right now to possibly under 20 per cent.
On Friday, Morneau called provincial demands for bigger federal health funding transfers "out of the realm" of anything Ottawa would consider.
One proposal supported by at least several provinces has asked Ottawa to maintain the annual transfer increases at least as high 5.2 per cent, while another provincial pitch has called on the federal government to ensure its share of provincial health-care budgets is pegged at 25 per cent.
But Morneau insisted the federal government wouldn't agree to keep the annual increases in transfers above three per cent, nor would Ottawa raise its share of spending to 25 per cent of provincial health budgets.
If the two sides can't reach a deal, Morneau said Ottawa intends to move forward with the Liberals' campaign commitments.
The provinces have warned they will face big holes in their health-care budgets if the annual increase falls from six per cent.
Ottawa's plan to allow annual health transfers to fall from six per cent to three per cent would trim nearly $1.1 billion this year from its combined payments to the provinces.
But that amount would compound quickly over the coming years.
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