NEW BRUNSWICK, OTTAWA STRIKE HEALTH DEAL

‘It’s exactly what we needed,’ premier says

• New Brunswick Premier Brian Gallant’s decision to strike a bilateral deal on health funding with the Trudeau government has splintered the united provincial front and hardened Ottawa’s resolve to reject attempts to extract billions more from federal coffers.

Gallant said he was hoping a pan-Canadian deal would have been reached, but is pleased and relieved a deal has been reached for his province.

“Today’s agreement ensures that we can receive funding for home care and mental health this spring that might otherwise have been delayed or lost,” Gallant told a news conference in Fredericton Thursday.

The deal includes $230 million in additional funding over 10 years for health care and programs for seniors.

“It’s exactly what we needed and exactly what we wanted,” Gallant said.

Annual Canada Health Transfer payments to the province will increase by three per cent per year or the rate of national GDP growth, whichever is higher. Gallant said that’s worth an estimated $1.2 billion over 10 years for New Brunswick.

Gallant’s move has prompted angry responses from some provinces but federal officials say as many as five others are discussing the possibility of striking their own bilateral deals.

On Monday, the premiers unanimously rejected a federal offer to increase transfer payments by 3.5 per cent annually and fork out another $11.5 billion over 10 years in targeted funding for home care and mental health.

Saskatchewan Premier Brad Wall says he knows some provinces are talking individually to the federal government and he predicts some may yet follow New Brunswick’s example.

Wall says the provinces’ bargaining position is weaker as a result but he understands that sometimes an individual province’s interests are best served through bilateral negotiations.

The federal government had offered a flat increase of 3.5 per cent, but Gallant said projections for GDP growth should mean approximately a 4.1 per cent increase in health transfers.

Gallant said he’s not concerned his province is going first, because the agreement includes a clause ensuring that if any other province gets a deal with better financial terms, New Brunswick can adopt those terms.

“Putting in this clause was crucial for us to sign this agreement,” Gallant said.

Quebec’s health minister has criticized New Brunswick, saying Gallant has reduced the chances of a panCanadian deal by going out on his own.

“NB chooses to accept reduction of fed funding from 23.3% to 20% but also rely on other provinces to fight for a better offer,” Gaetan Barrette wrote in a tweet Thursday.