Last week, in connection with the release of the 2021–2022 provincial budget, Jason Kenney announced what he referred to a “historic investment in health care”.
The announcement included two parts. The first is one-time funding of $1.25 billion related to the province’s COVID-19 response. This will likely be spent on acute care, continuing care, testing and assessment centres, contact tracing, surgical backlog caused by the pandemic, personal protective equipment, and vaccine deployment.
The second part was $23 billion in total health expenses. According to the announcement, this represents an increase of $900 million in health care spending, which they claim is the “largest single-year investment in health care in Alberta history.”
This must be what they mean by “historic”.
|Salaries, wages, benefits||$8,716|
|Supplies & services||$5,904|
|Grants to others||$6,795|
|Amortizing capital assets||$645|
Of that $23 billion, $21.418 billion will be going to operating expenses within the ministry of health.
The government forecasts operating expenses for the current budget year (which ends this month) at $20.541 billion. Technically, that’s an increase of $877 million, but it’s pretty close to $900 million.
There a couple of things we should realize, however, about this increase.
First, the UCP government had originally budgeted $20.616 billion for health in the 2020–2021 budget year. This is really more like a $802 million increase over 2020–2021.
Second, the health ministry spent $20.870 billion on operating expenses for the 2019–2020 budget year. So, while the 2021–2020 budget amount is $802 million more than what was budgeted this time last year, it’s only $548 million more than what they spent in their first budget.
You see, what the UCP aren’t telling you is that while they may have increased the budget by $802 million—er, $877 million (or is it $900 million—over last year, they actually cut spending by $329 million between its first and second budgets.
The announcement also framed the $900 million increase as a 4% more in total spending. If we reframe that in reference to the numbers above, we see that it’s actually a 3.7% increase compared to the original 2020–2021 budgeted amount and only a 2.6% increase compared to 2019–2020.
The NDP, by comparison, increased health spending by 3.3% in 2018–2019, 5% in 2017–2018, 3.7% in 2016–2017, and 0.6% in 2015–2016.
Oh, speaking of percentages.
Population growth averaged 1.28% each year between the end of 2018 and the end of 2020. The annual inflation averaged 1.74% between 2018 and 2020. Let’s assume the same numbers for 2021–2022. That means just to cover population growth and inflation, the government would have to increase spending on health operating expenses by 3.02%.
If you factor in the cut to spending last year from 2019–2020, this new increase isn’t enough to cover population growth and inflation.
And since they’re the ones who brought up “historic”: the health transfer from the federal government for 2021–2022 will be $5.03 billion, an increase of about $159 million. This is the first time that Alberta has ever received more than $5 billion in health transfers from Ottawa.