Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Monday, December 19, 2011

Flaherty Says Canada Needs to Be ‘Realistic’ About Health-Care Transfers

Canadian Finance Minister Jim Flaherty said the nation’s provinces need to be “realistic” about future payments they receive for programs such as health care, as the federal government copes with slowing growth while planning to balance its budget.

Flaherty said he will have a “serious discussion” with his provincial counterparts at a two-day meeting in Victoria, British Columbia about growth in transfers, adding it makes sense to consider pegging them to economic benchmarks such as nominal gross domestic product, which he called the “best predictor” of government revenues

“We have to be realistic,” Flaherty, 61, told reporters yesterday ahead of the meeting. “You can’t have a fiscal plan that takes us in the direction of, quite frankly, some of the countries in southern Europe that have gotten into a lot of trouble.”

Prime Minister Stephen Harper’s Conservative government has pledged to eliminate the federal deficit by the year starting 2015, in part by cutting annual operating expenses for the federal government by at least C$4 billion ($3.8 billion), even as an aging labor force and slow global recovery crimps the country’s expansion.

The federal government paid C$37.2 billion in the year ended March for health and social programs to provincial governments as part of Canada’s federal transfer system.


Transfer Payments


Canada’s current transfer agreements, which include “equalization” payments designed to smooth economic disparities among provinces, expire in the year ending March 2014. The Conservatives have said they will keep health transfers growing at the existing annual rate of six percent for two years after the current agreement on health expires.

Canadians “realize that there’s no free lunch,” Flaherty said. “There will be nothing sudden or abrupt going forward, but I’ll be able to talk to my colleagues about what we think needs to done.”

Basing transfers on nominal economic growth would reduce payments for health by C$26 billion, which would “damage health care and make it more difficult to transform the system,” Ontario finance minister Dwight Duncan wrote to Flaherty in a letter sent before the meeting.

Duncan told reporters today he would like provincial premiers to meet by the end of the year to discuss reaching a new health agreement with the federal government in 2012.

Reduce Access, Service


“The federal government is clearly signaling it will not support health care to the extent it has in the past,” he said, adding that curbs on transfer growth would reduce public access to the system and quality of service.

While the federal government needs to be a “full financial partner” in funding health care, provinces must come up with ways of reducing the costs of delivery, said B.C. Finance Minister Kevin Falcon.

“We are fooling ourselves if we think the challenge of health care is just about money,” he said. “It’s also how we’re delivering the health care system and making sure we dramatically try to innovate within the health care system to control costs.”

Speaking before the meeting, Flaherty said he will encourage finance ministers from the nation’s 13 provinces and territories to be responsible with their own budgets.

“We all realize that public finances relate to revenues,” Flaherty told reporters. “We can’t pretend that we can spend money that we don’t have.”

Ontario Outlook Cut


The outlook on Ontario’s Aa1 rating was cut Dec. 15 to negative from stable by Moody’s Investors Service on concern that Canada’s most-populous province faces increased risks in meeting fiscal targets amid a slowdown in economic growth.

The reduction wasn’t unexpected, Duncan said. “We’ve got a real fiscal challenge that we have to meet.”

Flaherty also said yesterday he continues to monitor the country’s housing market, after a report last week by Statistics Canada that showed the ratio of household debt to income climbed to a record. Asked if the government will take additional steps to cool the market, Flaherty said: “we’ll see.”

On Europe, he said the International Monetary Fund should be assigned the task of monitoring the debt situation in Europe, which he said was “quite serious.”

Europe needs to take additional steps to resolve the crisis, including measures to recapitalize the region’s banks and build a “firewall” around troubled countries, Flaherty said. The region’s debt should be “primarily” addressed with European resources, he said.

Origin
Source: Bloomberg 

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