Reinstating health-care premiums to help Alberta deal with a revenue shortfall is getting a mixed reaction from local politicians and stakeholders.
Declining prices for bitumen mean Alberta will earn $6 billion less than anticipated in resource revenue this year, a development that has the government scrambling to cut costs and find other sources of income, one of them being the restoration of health-care premiums.
“It never should have been eliminated,” said Darryl LaBuick, family physician and president of the St. Albert and Sturgeon Primary Care Network. “We need to have more personal accountability to health care costs.”
Premier Ed Stelmach eliminated the premium on Jan. 1, 2009. In 2008, families were charged $1,056 while singles were charged $528 for the premium, which generated roughly $1 billion in revenue each year for the province.
Premier Alison Redford suggested Monday in a conference call with PC supporters that increasing taxes is an option the government could look at to address the $6 billion shortfall. The province will bring in a budget for 2013-14 on March 7.
A new government website, www.budgetchoice.ca, offers Albertans an opportunity to formulate a provincial budget. It details how a five per cent sales tax could generate $5 billion in revenue, while a health care premium would generate $1 billion in revenue.
LaBuick said it was irresponsible of the former Progressive Conservative government to eliminate the premium, adding the decision didn’t benefit anyone.
“I think there was some very poor planning done by government when it came to this financial shortfall we’re seeing and I think that there’s been a lot of irresponsibility by the governments in the past,” he said.
St. Albert Mayor Nolan Crouse said the government needs to take multiple steps to generate revenue and decrease spending given the current financial circumstances, including reinstating the premium.
Lynda Moffat, president and CEO of the St. Albert and District Chamber of Commerce wasn’t so sure.
“With the aging population and the new people coming in, I think (not having the premium) is an incentive for people to come here and it really does help the families in need,” she said.
Wildrose leader Danielle Smith said the problem has more to do with excess spending than a lack of revenue, adding the health care premiums are a “wasteful and inefficient form of taxation.”
Alberta New Democrat leader Brian Mason called the premium “backwards and regressive,” adding lower-income and middle-class families are unfairly impacted.
In addition to reinstating the health care premium, Crouse said the provincial government should freeze all department hiring and public-sector wages.
He said he also wants government alter the tax structure so wealthy individuals and corporations contribute more of their earnings to taxes, as well as implement and increase user fees, such as fuel and tire taxes.
“This added revenue could pay for transportation. Parking fees, admission fees, you name it – increase it,” Crouse said.
LaBuick said the government needs to reconsider some of the promises it made to Albertans during campaigning, adding the commitment to spend $3.4 billion over a three-year period to construct 140 family care clinics in the province is a duplication of services that could be done more efficiently.
Despite talk of tax increases, Moffat said it is in the province’s best interest to maintain the lowest tax base in Canada.
“It really helps us draw business and residents to our province,” she said.
Redford is hosting the province’s first economic summit on Feb. 9 in Calgary, which will facilitate discussion amongst industry experts, business and non-profit leaders and academics.
Moffat said she will put her name forward to see if she can represent the Chamber in the discussion.
