The proposed seven-year agreement is retroactive to April 2011, when the last contract expired, so the first two years of the pay freeze are over.
"Yes, there will be some pain for those first three years," said Dr. Michael Giuffre, president of the Alberta Medical Association. "(But) the ability to have a say in health care all the way through will make (doctors) happy to sign it."
Giuffre commented at a Calgary clinic where Premier Alison Redford and Health Minister Fred Horne announced the memorandum of understanding.
Both sides have one week to craft a final agreement that would extend to 2018 and will have to be approved by doctors and the government.
The proposal includes a 2.5 per cent increase in each of the two middle years and cost of living increases in the final two.
There is also to be a one-time, lump-sum payment totalling $68 million to be distributed by the Alberta Medical Association and the province to address financial challenges faced by doctors in their practices.
The deal would also see the creation of a physicians committee to oversee compensation, arbitration rights on fees and specific benefits and recognition of the medical association as the ongoing bargaining representative for physicians.
The organization represents 8,000 doctors.
"This deal marks the beginning of a new era of understanding and partnership between the government of Alberta and Alberta's physicians," said Redford.
"Any future decisions will be made collaboratively with doctors."
Horne said that he and Giuffre have been talking directly in recent weeks, because they realized that they needed to get the deal done soon or risk months of stalemate.
"There was certainly a sense of urgency," said Horne.
"We made a decision to kind of excuse the (negotiating) officials."
Negotiations became acrimonious late last year after Horne imposed a wage deal on doctors and then withdrew it in the face of widespread criticism.
Last month, the province passed a no-frills budget for 2013-14 that capped money for doctors' salaries at $3.4 billion and offered no room for salary increases.
Giuffre had said physicians need help with rising overhead costs and want more say on major initiatives such as new family-care clinics.
In a letter on the association's website Monday, he said the memorandum addresses what physicians have been seeking while recognizing the government’s financial situation.
It was a different tone than last month, when talks hit an impasse, and Giuffre accused Horne of breaking promises and bargaining in bad faith.
In Edmonton, party leaders characterized the proposed deal as fair, but pointed out it is essentially the same one the province had promised in principle to doctors a year ago. That deal subsequently fell apart months later in negotiations.
"It seems like they (the Tories) over-promise, under-deliver and create an unnecessary amount of turmoil before finally being dragged kicking and screaming to an agreement," said Wildrose Opposition Leader Danielle Smith.
Liberal Leader Raj Sherman said Redford, facing falling popularity numbers in polls, realized she couldn't break the doctors.
"Premier Redford clearly blinked," said Sherman.
NDP Leader Brian Mason applauded the doctors for pushing Redford's Progressive Conservative government to follow through on the original deal in principle.
"The Redford government has set a world speed record for breaking promises," said Mason.
"The doctors have shown that by standing up to the Redford government you can get them to back down."
— By Dean Bennett in Edmonton
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