Canada’s premiers say federal transfers to the provinces must be re-examined in light of a new report from the Conference Board of Canada that projects the country’s aging population will increase provincial costs while federal surpluses soar.
The report, entitled A Difficult Road Ahead: Canada’s Economic and Fiscal Prospects, was commissioned last year by the premiers.
It says Canada’s aging population will result in weaker economic growth and less revenue for provincial governments to fund programs and services.
The rise in the number of seniors is also expected to increase demand for health care, which will create additional costs. This will make it difficult for provinces to balance their books in the long term, the report states.
Meanwhile, the Conference Board of Canada projects the federal government will improve its financial outlook, with an estimated $109 billion surplus by the year 2034-35.
The country’s premiers, who are meeting in Charlottetown this week, believe this report lends credence to their long-voiced concerns over the need for greater health and fiscal transfers to the provinces.
“Last year in Prince Edward Island, our health care budget grew by approximately $30-million. How much did the federal government contribute out of that $30-million? They contributed approximately $8-million,” Ghiz told reporters Thursday afternoon.
“Even though they may be still contributing to increases, it’s not keeping up to the pace on how much our health budgets are going.”
Ghiz said the premiers will come out later today with a more concrete request to the federal government on where the provinces need more help to deliver social programs.
He said the costs associated with the country’s aging population as well as concerns over a shortage of infrastructure dollars from the feds are the issues of highest concern to the premiers as they continue their deliberations as part of the annual Council of the Federation meetings taking place this week in Charlottetown.