Per Capita Woes

Have any of the New Brunswick media outlets, pundits or bloggers discussed the issue of making health and other social transfers to the provinces move to a ‘per capita’ basis? Here’s a mention in one Canadian Press story:

Ontario and Alberta, which receive no benefit from equalization, have long complained that they’re deprived of their full per-capita share of other cash transfers. That’s resulted in a $1.1-billion annual shortfall for Ontario, a gap Premier Dalton McGuinty has insisted must be closed. As a first step, Flaherty earmarked $700 million to immediately ensure Ontario and Alberta get their full share of social transfers. And he promised legislation to ensure strict per-capita distribution of health care transfers after 2014, when the existing 10-year health accord with the provinces expires.

This is a very interesting little tidbit that should be foremost in the minds of bureaucrats in New Brunswick. You see, if the Feds start transfering health and social transfers on a ‘per capita’ basis, New Brunswick – which is actually in a slight population decline – might end up needing to cut spending. Remember, under Bernard Lord government spending rose at a similar rate as Ontario even though that province witnessed a very strong population growth while we stagnated.

Essentially, if the Feds start tying transfers to a strict population formula, Alberta and Ontario will get hundreds of millions more every year while New Brunswick, Newfoundland and maybe others could actually be cut back year over year.

For me, this was by far the biggest issue in this budget. The feds are going to force New Brunswick to increase its population if it wants to keep getting increases in federal transfers. Sure 2014 seems quite far away but in the life of a country and a struggling province – it’s just down the road.

The “water on the beans”, if you will allow me a local expression, is changing folks.

I can’t find anyone writing about this in New Brunswick. I have been out of the province so I would appreciate you sending me any references to this in the local media.

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0 Responses to Per Capita Woes

  1. scott says:

    Good post, David. You should write a paper on that very subject. It seems as though think tanks have clearly discussed the effects of the fiscal imbalance on province’s l;ike Saskatchewan, Ontario, Quebec, etc. I can’t find any study specifically for NB as I dion’t count AIMS because they usually lump NB in with the reat od the maritimes when discussing economic issues.