Communications

Highlights of 2005 Federal Budget

For the Attention of Hospital CEOs, Board Chairs, OHA Board of Directors and CACN Members

From Steve Orsini, Vice President, Policy and Public Affairs

Yesterday, Finance Minister Ralph Goodale tabled the 2005 Federal Budget in Ottawa under the title "Budget 2005: Delivering on Commitments". The Federal Government’s news release and document Securing our Social Foundations: can be accessed at www.fin.gc.ca/budget05/pamph/pasoce.htm.

The federal government obviously feels that the commitments from the September 2004 First Ministers’ Meeting (2004 FMM) are significant and sufficient. The 2004 FMM does provide permanent funding in the form of a built-in escalator clause to deal with yearly cost pressures faced by hospitals and other health care providers. A summary of the 2004 FMM is available for your information under related links on the side of this page.

Health Care Highlights from "Securing Our Social Foundations"
Fall 2004-Major Investments in Support of Health and Social Priorities
In September 2004, First Ministers signed a 10-Year Plan to Strengthen Health Care. The Prime Minister committed $41.3 billion over 10 years in support of the plan, fully meeting the financial recommendations of the Royal Commission on the Future of Health Care in Canada (the Romanow Report).

An additional $700 million over five years for Aboriginal health programs and $150 million for health care services in the North was also announced.

In October, the Government of Canada also launched a new framework for Equalization and Territorial Formula Financing that will add an additional $33 billion in federal support over the next 10 years.

Legislation implementing these commitments has already been tabled in the House of Commons.

Budget 2005
Budget 2005 builds on the investments outlined above with $805 million over five years ($100 in 2005/06) in new direct federal health funding:

  • $75 million over five years to accelerate and expand the assessment and integration of internationally educated health care professionals.
  • $15 million over four years for wait times initiatives that will build on and complement provincial and territorial initiatives.
  • $110 million over five years to improve the data collection and reporting of health performance information.
  • $300 million over five years for an integrated strategy to encourage healthy living, and prevent and control chronic disease.
  • $34 million over five years to enhance Canada’s pandemic influenza preparedness.
  • $170 million over five years to help ensure the safety and effectiveness of drugs and other therapeutic products.
  • $10.7 million in 2004/05 for the Hepatitis C Prevention, Support and Research Program.
  • $90 million over five years for Health Canada to accelerate work to identify and research toxic substances under the Canadian Environmental Protection Act.


Other Health Care Highlights

  • Granting Councils - Since 1998, the Government of Canada has allocated significant new resources each year to the granting councils. Budget 2005 will increase the annual budgets of the three granting councils by an additional $75 million per year, starting in 2005/06. These incremental funds will be allocated as follows: $32 million each for the Canadian Institutes of Health Research and the Natural Sciences and Engineering Research Council, and $11 million for the Social Sciences and Humanities Research Council of Canada. This funding will enable the councils to enhance their support for new and promising researchers, and to sustain their overall support for research in Canada.
  • National Security Policy - Building on the Pandemic Influenza Plan announced in February 2004 and the $24 million recently announced to purchase antivirals, a further $34 million, over five years will be invested in pandemic influenza preparedness.
  • Emergency Management - Budget 2005 provides $56 million in funding over five years for emergency management initiatives, such as the federal-provincial-territorial forum on emergencies.
  • GST/HST Health Care Rebate - Further to extensive consultations with provincial and territorial health and finance authorities, the budget proposes to extend, effective January 1, 2005, the application of the 83% rebate to eligible charities and non-profit organizations that provide health care services similar to those traditionally performed in hospitals.


For further information, please contact Lou Reidel, Director, Policy and Research at lreidel@oha.com or 416-205-1320.