Interest payments on government debt siphon $$$ away from health care

A new study again calls into question the sustainability of Canada’s health care system as interest payments on government debt siphon money away from programs and services important for the health of the country, not only Medicare itself but also other elements such as social services and education.

“Paying the interest on all government debt in Canada cost taxpayers $62.8 billion last year, which translates into $1,752 for every Canadian or slightly more than $7,000 for a family of four,” finds a study released January 20, 2017, by the Fraser Institute.

“It’s not a choice—interest must be paid on government debt, and the more money governments spend on interest payments the less money is available for the programs and services that matter to Canadians,” said Charles Lammam, the institute’s director of fiscal studies and co-author of The Cost of Government Debt in Canada.

The study found that interest payments on all government debt—including federal, provincial and municipal debt—in 2015/16 cost roughly the same amount as what the country spent on public primary and secondary education combined, which totalled $63.9 billion in 2013 – 2014, the last year of available data.

Alberta’s combined provincial-federal debt interest payments will cost $5.3 billion this year, which is more than the province will spend on social services, including welfare, the institute points out.

That $5.3 billion is equal to 25.1% of the $21.1 billion that Alberta will spend on health care in the 2016 – 2017 fiscal year, according to the calculations by Canadians for Sustainable Medicare [C4SM].

Based on an Alberta population of 4,269,000, per person spending on health care is $4,942; and, per person spending on combined federal – Alberta interest payments is $1,241. The  Alberta Government itself calculates health care spending at $2.4 million per hour and $58 million per day.

No, Medicare isn’t free.

And, interest payments to service government debt erode the sustainability of the health care system.

 

Canada’s government-run health care system – Medicare -- is a monopoly that prohibits private hospital and private physician care. Medicare is a subpar performer, ranking 10th among 11 advanced countries. Canadians deserve much better! Patients deserve timely access to quality care and choice of hospitals and physicians. Taxpayers deserve much more value for their tax dollars.

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