05/06/2012 09:56 EDT | Updated 07/06/2012 05:12 EDT

Tough labour negotiations between Ontario doctors and government reach impasse

TORONTO - Tense labour negotiations between the minority Liberals and Ontario's doctors appear to have reached an impasse.

Health Minister Deb Matthews is expected to provide an update Monday about the talks, which stalled late last week.

In a letter obtained by The Canadian Press, Matthews agreed Friday to allow a conciliator to help the two parties reach an agreement after repeated requests by the Ontario Medical Association.

But she insisted that doctors must agree to a wage freeze and set a deadline of Sunday to reach a new labour agreement.

The OMA responded to Matthews the same day, saying they needed more than a weekend to hammer out an agreement and wanted to start the conciliation process on Monday.

Matthews says she's disappointed that the OMA rejected her offer and that the government is now looking at its options, which includes imposing an agreement on doctors.

"The hope that we will reach a negotiated settlement is dimming," she said in an interview late Sunday.

She said she's determined to transform Ontario's health care system, which requires doctors to do their part and accept a wage freeze.

She set the deadline because there has been no real progress with the OMA since formal talks began in February, Matthews said. She made it clear that the government needed an agreement by end of April, but the OMA hasn't offered any concrete proposals that will help the government reach its fiscal target, she added.

The two sides have been battling it out for weeks, with the cash-strapped government insisting that it can't afford any new funding increases for doctors as it faces a $15-billion deficit.

The minority Liberals are demanding the same from all broader public sector workers, including teachers, nurses and civil servants. They've also threatened to legislate the pay freeze if all other options at the negotiating table fail.

"Though we are eager to reach a negotiated agreement, please note the government's fiscal mandate remains unchanged," Matthews wrote in the May 4 letter to the OMA.

"As we have indicated throughout the negotiations we continue to urge the OMA to provide input as to how we can reach these goals together. I'd like you to know that we're willing to work with you through the weekend, but we must insist on a deadline of Sunday, May 6 at 8 p.m. to reach an agreement."

But OMA president Dr. Stewart Kennedy rejected the offer, saying a rushed process isn't the way to negotiate a fair deal with doctors.

"Your proposal to embark on a 48-hour process with a pre-determined outcome is not a true conciliation process," it said.

"However, we are pleased that you have reconsidered your earlier position, and are now willing to bring a conciliator to the table. We propose that we meet first thing Monday morning to agree on an individual who will then work with the parties to establish a process to discuss and resolve our differences."

Matthews said she tried to reach out to the OMA Saturday night, when the organization's new president Dr. Doug Weir officially took over, but it wasn't interested.

"The issue wasn't more time, but more money," she said Sunday.

The OMA said it offered to freeze doctors' fees for two years and find an additional $250 million in savings, but Matthews rejected the proposal.

Instead, the government is threatening to unilaterally cut fees that doctors are paid if they refuse to absorb the costs and plans to table regulatory changes to do so.

But Matthews said the OMA wants the government — which already spends $11 billion a year on doctors' fees — to pay for the rising costs of health care as the population ages. She wants the doctors to find the money to fill the gap.

The OMA has warned that patients will have to wait longer for health care if the government forges ahead with the fee cuts.

Matthews dismissed it as an "absurd" and "misleading" argument, saying 93 per cent of Ontarians now have access to a family doctor — about 2.1 million more than when the Liberals took office in 2003.

She said the government is adding 550 more doctors each year, but if it has to pay doctors more, that will reduce its ability to pay for new doctors.

The pay freeze for doctors and nurses is part of the Liberals' plan to reduce annual growth in health-care spending to 2.1 per cent a year from the current 6.1 per cent, in order to slay the deficit in 2017.