POLA51 Federal-Provincial Programs (Shared-cost vs. Block Payments)

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16 Apr 2012

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Week 11: April 5th
-In Canada, all citizen’s health care is administered via a public system.
-A pool of fund, collected via taxation, is managed and paid out by
-Federal and provincial governments share the costs.
-Shared-cost programs
oOttawa’s contribution matches the provincial spending dollar for
oThe Canada Assistance Plan (scrapped in 1995)
oAd hoc caps and freezes rampant throughout s-c history.
oEducation & health costs started as shared cost programs.
Converted into Block Funding in 1977.
Feds argued that s-c programs did not encourage
provinces to control program costs.
Shared-Cost Provincial Programs
-Social Union Framework Agreement (SUFA)
-Health care funded through the Canada Health Transfer (CHT)
-Social assistance and postsecondary education funded through the
Canada Social Transfer (CST)
-Early Learning and Child Care (ELCC)
-Social housing; affordable housing
-Canada Student Loans
-Block funding
oOttawa’s contribution is geared to the previous year’s subsidy
plus an amount calculated on the basis of growth in the recipient
province’s gross product.
oOttawa is not obliged to match provincial spending.
Indeed, more and more of education and healthcare costs
are being shouldered by the provinces.
-The Provincial Burden
oWhat’s the problem?
oProvinces argue that Ottawa encouraged them to spend more in
the days of shared-cost, therefore, unfair to back out now!
oProvinces share all major tax fields with federal government,
unless feds are willing to share more tax revenue from certain
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