Ottawa’s health-care deal cements failed status quo in Canada

Canada will reach a projected $244.1 billion in 2023, which translates to $6,205 per person—nearly double the level of per-person spending (inflation-adjusted) three decades ago. And yet, last year Canadians endured the longest median wait time (27.7 weeks) ever recorded for non-emergency surgery.

Last week, as part of Ottawa’s promised $46 billion in additional health-care spending, the Trudeau government agreed to increase Quebec’s share of federal health-care dollars by $900 million annually. Quebec was the last province to reach an agreement with Ottawa before the March 31 deadline. With the closure of this agreement, Canadian taxpayers are on the hook for more health-care spending than ever before. For the same old broken health-care system.

Of course, it ultimately doesn’t matter whether the $46 billion originates from Ottawa or the provinces. In the end, Canadian taxpayers foot the bill. And what do we get in return for our health-care dollars?

In 2021, the latest year of comparable data, Canada’s total health-care spending (as a percentage of the economy) was the highest among 29 other comparable countries with universal health care (after adjusting for differences in population age). This isn’t a new development. Canada has a long history of having one of most expensive systems among high-income universal health-care countries.

Despite this, according to the latest comparable data, Canada ranks among the poorest performing universal health-care countries in key areas such as the number of physicians, hospital beds and diagnostic technology (e.g. MRI machines). Further, according to the Commonwealth Fund, in 2020 Canada ranked dead last on timely access to specialist consultations and non-emergency surgery.

Meanwhile, public health-care spending in Canada will reach a projected $244.1 billion in 2023, which translates to $6,205 per person—nearly double the level of per-person spending (inflation-adjusted) three decades ago. And yet, last year Canadians endured the longest median wait time (27.7 weeks) ever recorded for non-emergency surgery.

In short, Canada’s health-care system is in shambles, but the answer does not lie in simply throwing more money in its general direction. Federal politicians should instead look to the example of welfare reform during the Chrétien era in the 1990s. Those reforms, which reduced federal transfers to provinces and eliminated most of the “strings” attached to federal funding, resulted in increased provincial autonomy, greater policy experimentation, fewer Canadians needing welfare and savings for the federal government (i.e. taxpayers).

This is the opposite of today’s approach to health care, where the existing vehicle for federal funding (the Canada Health Transfer) is connected to the Canada Health Act (CHA), which prevents provincial governments from innovating and experimenting in health care by threatening financial penalties for non-compliance with often vaguely defined federal preferences. The result is a stalemate that satisfies no one and ensures that Canada’s policies remain at odds with the policies of our better-performing universal health-care peers.

While new federal dollars for health care are undoubtedly appealing to premiers, they will not improve the state of health care for Canadians. Until our federal politicians have the courage to reform the CHA and follow the example of 1990s welfare reform to improve outcomes, our health-care system’s unacceptable status quo will continue.

Authors:

Mackenzie Moir

Senior Policy Analyst, Fraser Institute

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Related Topics:#CanadaHealthCare #FraserInstitute #HealthCareSpending #JakeFuss #MackenzieMoir

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Federal Budget 2025: A responsible media would ensure Canadians know about the dismal state of federal finance

Published on October 17, 2025

Todayville

From the Fraser Institute

By Jake Fuss and Grady Munro

From 2014 to 2024, gross government debt (including federal, provincial and local governments) increased from 85.5 per cent of the economy (measured by GDP) to 110.8 per cent—a larger increase than any other G7 country. When debt grows faster than the economy, government finances are unsustainable.

Ahead of the Carney government’s long-awaited first budget scheduled for Nov. 4, a recent CBC commentary described the long-standing debate about the federal deficit and the state of federal finances as “something of a phoney war.” And that calls to balance the budget—expressed today and over the last decade—have lacked any serious discussion about the trade-offs between allowing deficits to persist versus balancing the budget.

While there’s certainly something to be said about the political theatre that regularly dominates the House of Commons—which we agree focuses too often on scoring political points instead of adequately assessing the merits of policy—it’s wrong to downplay concerns about the state of federal finances. Such concerns aren’t “phoney.”

Consider this. From 2014 to 2024, gross government debt (including federal, provincial and local governments) increased from 85.5 per cent of the economy (measured by GDP) to 110.8 per cent—a larger increase than any other G7 country. And federal gross debt increased from 53.0 per cent of the economy in 2014/15 to a projected 70.0 per cent in 2024/25. When debt grows faster than the economy, government finances are unsustainable. And the Carney government seemingly plans to continue this same approach.

In other words, the government plans to continue to spend more than it collects in revenue, continue to run massive deficits, and continue to rack up large amounts of debt.

Why should Canadians care?

Because the costs of government debt land squarely on their backs. For example, when government debt levels rise, the cost of debt interest often also rises. This year the federal government will spend a projected $54.5 billion on debt interest costs—equivalent to what it sends to the provinces for health care. Moreover, when governments borrow money, they can help drive up the cost of borrowing by increasing demand for the limited pool of savings that both government and the private sector compete for—making it more expensive for a family to take out a mortgage or businesses to attract investments. And to pay for today’s debt accumulation, governments in the future may raise taxes—a burden that will fall disproportionately on younger generations.

Again, given this alarming deterioration in the state of government finances over the last decade and the costs it imposes on Canadians, there’s nothing disingenuous about calling for more fiscal discipline from Ottawa.

Of course, getting federal finances back in order is no small task—the Trudeau government’s forays into areas of provincial jurisdiction (which carry huge price tags), combined with Carney’s massive new spending commitments for defence and other programs, mean the government cannot balance the budget without significant trade-offs. In the past, the federal government has overcome similar fiscal circumstances by committing to balance the budget and outlining a clear plan to achieve this goal. The Carney government should heed these lessons and apply them in its upcoming budget.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute

Alberta

Alberta taxpayers should know how much their municipal governments spend

Published on October 16, 2025

Todayville Content Team

From the Fraser Institute

By Tegan Hill and Austin Thompson

Next week, voters across Alberta will go to the polls to elect their local governments. Of course, while the issues vary depending on the city, town or district, all municipal governments spend taxpayer money.

And according to a recent study, Grande Prairie County and Red Deer County were among Alberta’s highest-spending municipalities (on a per-person basis) in 2023 (the latest year of comparable data). Kara Westerlund, president of the Rural Municipalities of Alberta, said that’s no surprise—arguing that it’s expensive to serve a small number of residents spread over large areas.

That challenge is real. In rural areas, fewer people share the cost of roads, parks and emergency services. But high spending isn’t inevitable. Some rural municipalities managed to spend far less, demonstrating that local choices about what services to provide, and how to deliver them, matter.

Consider the contrast in spending levels among rural counties. In 2023, Grande Prairie County and Red Deer County spent $5,413 and $4,619 per person, respectively. Foothills County, by comparison, spent just $2,570 per person. All three counties have relatively low population densities (fewer than seven residents per square kilometre) yet their per-person spending varies widely. (In case you’re wondering, Calgary spent $3,144 and Edmonton spent $3,241.)

Some of that variation reflects differences in the cost of similar services. For example, all three counties provide fire protection but in 2023 this service cost $56.95 per person in Grande Prairie County, $38.51 in Red Deer County and $10.32 in Foothills County. Other spending differences reflect not just how much is spent, but whether a service is offered at all. For instance, in 2023 Grande Prairie County recorded $46,283 in daycare spending, while Red Deer County and Foothills County had none.

Put simply, population density alone simply doesn’t explain why some municipalities spend more than others. Much depends on the choices municipal governments make and how efficiently they deliver services.

Westerlund also dismissed comparisons showing that some counties spend more per person than nearby towns and cities, calling them “apples to oranges.” It’s true that rural municipalities and cities differ—but that doesn’t make comparisons meaningless. After all, whether apples are a good deal depends on the price of other fruit, and a savvy shopper might switch to oranges if they offer better value. In the same way, comparing municipal spending—across all types of communities—helps Albertans judge whether they get good value for their tax dollars.

Every municipality offers a different mix of services and those choices come with different price tags. Consider three nearby municipalities: in 2023, Rockyview County spent $3,419 per person, Calgary spent $3,144 and Airdrie spent $2,187. These differences reflect real trade-offs in the scope, quality and cost of local services. Albertans should decide for themselves which mix of local services best suits their needs—but they can’t do that without clear data on what those services actually cost.

A big municipal tax bill isn’t an inevitable consequence of rural living. How much gets spent in each Alberta municipality depends greatly on the choices made by the mayors, reeves and councillors Albertans will elect next week. And for Albertans to determine whether or not they get good value for their local tax dollars, they must know how much their municipality is spending.