Quebec threatens to walk out of health talks if Ottawa doesn't budge

There is no deal in sight as the federal government sits down today with the provinces on the future of health-care funding in Canada.

Quebec Health Minister Gaetan Barrette says his province will walk out of the health-care meetings unless the federal government enriches its offer.

The provinces argue the most recent proposal from Ottawa is a step back from the Harper government plan.

But the federal Liberals don't appear ready to budge from their offer that would fix health-care increases at 3.5 per cent per year, and add in about $8-billion over 10 years for home care and mental health.

Barrette says the federal offer will result in a decline in care, and he hopes federal Finance Minister Bill Morneau will see the light today.

Without a deal, the health-transfer arrangement would likely revert back to the Harper plan of at least three per cent a year, but provinces would also be looking to Ottawa to make good on an election promise to add $3-billion for home care.

Provinces say that framework punches a hole in their budgets and leaves them without the ability to innovate and modernize their health care systems.

Talks were acrimonious from the get-go. Several provinces wondered out loud late last week whether it was worth the trek to Ottawa for the meeting; and Barrette has been tweeting aggressively at Morneau to be more generous.

A Sunday dinner meeting at Rideau Gate on the grounds of the Governor-General yielded no compromise, leaving provincial ministers bitter and critical of what they described as an inadequate, take-it-or-leave-it offer from the Trudeau government.

Several provinces insisted that a proposal by the federal Liberals on health funding was presented as an ultimatum and accused Ottawa of making it without any real negotiations.

But, beyond shaming, it's unclear what kind of leverage provinces have since the federal Liberals control the purse strings.

Morneau said late Sunday that he hoped the provinces would have an open mind heading into the discussions.

His Monday-morning press release emphasized other subjects on the agenda — the state of the economy, infrastructure and retirement income.

Health ministers from across the country have been invited to join the finance ministers during a special afternoon session.

When asked Sunday about his expectations for Monday, British Columbia Finance Minister Michael de Jong gave a short reply: "Intense discussions."

Barrette said Sunday in an interview he and his counterparts were "not satisfied" with how Ottawa had approached the talks.

"There's been no negotiations whatsoever during the last year and we are being served an ultimatum by Bill Morneau, which is totally insulting and inappropriate," Barrette said.

When asked Sunday about the provinces' claims that Ottawa hadn't presented a good deal, Morneau responded by saying the federal government would like to ensure the talks lead to measurable outcomes "that will make a real difference for Canadians," particularly in mental health and home care.

Morneau has also said that the federal government would put a "significant" amount of money into those areas over a period longer than five years.

Ottawa has publicly said it plans to stick with a plan set by the previous Conservative government to see the six per cent annual increase in federal health funding fall to three per cent.

However, several provinces say that Morneau made them a slightly different offer on Friday.

Barrette and de Jong said Morneau has proposed a firm 3.5 per cent annual increase in transfers as well as another $8 billion over 10 years for specific areas such as home care and mental health. Ottawa is also talking about investing $1 billion into home-care infrastructure over four years, Barrette said.

The money is back-end loaded, more of it to be transferred in later years rather than soon.

The offer, de Jong said in an interview Sunday, could mean even less money for provinces over the next decade compared to just leaving the Liberals to follow through on their plan to invest $3 billion over four years into home care and to allow the six per cent annual increase in transfers fall to a floor of either three per cent or an average of nominal economic growth — whichever is higher.

The federal government's own projections predict that nominal growth will average above 3.5 per cent over the next decade, de Jong noted

"A clever proposal but not one that really addresses the pressures and a disappointment for us," de Jong said in an interview.

Even with the 2015 Liberal platform's pledge of $3 billion for home care, de Jong said he didn't think his province would necessarily be better off.

He also voiced concerns about the way he says the offer was delivered.

"The take it or leave it attitude that seems to be emanating from the Prime Minister's Office on this is not productive, it's certainly not collaborative, and really not acceptable," de Jong said.

Barrette said if the provinces accept Morneau's offer then the federal share of health funding will actually decrease from about 23 per cent right now to possibly under 20 per cent.

On Friday, Morneau called provincial demands for bigger federal health funding transfers "out of the realm" of anything Ottawa would consider.

But Morneau insisted the federal government wouldn't agree to keep the annual increases in transfers above three per cent, nor would Ottawa raise its share of spending to 25 per cent of provincial health budgets.