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Provinces eye Alberta's gains in bid to rebalance health funding

Provinces that are among the losers in the Harper health funding plan are turning their sights on Alberta and the multibillion-dollar windfall the Conservative bastion is set to gain in the next decade.

Rather than confront Prime Minister Stephen Harper head-on, provincial leaders left a two-day summit in Victoria resigned to the equal, per-capita cash transfer – at least until the next federal election.

Manitoba Premier Greg Selinger will lead a group of provincial and territorial finance ministers this spring on a quest to get Ottawa to redistribute those funds. The new federal plan establishes the annual rate of increase in transfers to the provinces for health care, but allocates the money strictly based on population – a formula that gives Alberta a boost in transfers at a cost to others, including B.C., Ontario and Quebec.

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The provincial and territorial leaders were unanimous in condemning the way the unilateral new deal was imposed. But they are struggling to fill the void after the Harper government refused to talk with them about how that money should be distributed or used.

The leaders also agreed to discuss establishing their own health-care standards, from developing clinical practice guidelines to curbing the cross-border poaching of skilled health-care workers. However, Quebec officials were quick to reject any imposition of new national standards.

Mr. Selinger's working group has the thornier task: the money. It will start by trying to lay out for Canadians how much each will get under the new arrangement compared to the old deal, which gave more to poorer provinces to allow them to provide the same level of care as the richer ones. The group will then attempt to show the effects of the change – a picture that is emerging only gradually since Ottawa's pronouncement last month.

"It's very clear," Mr. Selinger told a news conference wrapping up the meeting, "that a per-capita cash transfer being equalized for Alberta is something we're going to examine now to make sure nobody is worse off as a result of that."

B.C. Premier Christy Clark, the meeting's host, said the objective is to rebalance the deal so that no one province or territory loses ground. But with the federal government rejecting the idea of contributing extra funds, that could be achieved only if Ottawa were to claw back money now earmarked for Alberta.

"All of us believe it is possible to come up with a fiscal arrangement that leaves no one worse off than they currently are," Ms. Clark said. "Canadians across the country, senior citizens and other people who depend on our health care system, are depending on premiers to make sure that happens."

Alberta Premier Alison Redford, whose province will reap an annual windfall of nearly $1-billion under the new formula, according to calculations released by the B.C. government, showed little enthusiasm for rebalancing health transfers, although she agreed to the review.

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"This is an advantage to one province, and there's no doubt we are pleased to have that advantage," she said. "Alberta does believe that it is important to have equal per-capita funding. We have been making that point for a number of years."

The tone for the two-day provincial health-care summit was set last month when federal Finance Minister Jim Flaherty abruptly announced a unilateral Canada Health Transfer deal. Even as the premiers were meeting in Victoria, Mr. Harper was delivering the message – through the news media – that there is no room for negotiation.

Still, the premiers most disadvantaged by the new fiscal arrangement insisted that the "proposal" from Ottawa is a matter for bargaining, and a plan emerged to try to force Ottawa back to the table by using public pressure before the next federal election.

"Just because it's a 'no' today doesn't mean that come 2014, 2015, when there is going to be a federal election, it's going to be a 'no,'" said Premier Robert Ghiz of Prince Edward Island.

Quebec Premier Jean Charest said the premiers are being forced to analyze the funding deal because Ottawa has failed to let Canadians in on the debate about the future of health care. "This is to offer Canadians a picture of where we are at so that then we can have the debate and the discussion that the country should have – and should have had under the leadership of the federal government."

According to Ottawa's plan, federal transfers for health care will continue to grow at six per cent each year – a rate of increase set in a 10-year accord in 2004 – until 2016-17. After that, transfers would rise according to a system that ties increases to growth in nominal gross domestic product, which is a measure of real GDP plus inflation.

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