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A History of the Health and Social Transfers
| 2007 |
Budget restructured the Canada Social Transfer (CST) to provide equal per capita cash support to provinces and territories, effective 2007-08; similar changes to be made to the Canada Health Transfer (CHT) effective 2014-15, when its current legislation is renewed. CST funding has been increased by $687 million in 2007-08 to support the new cash allocation; in 2008-09, it will increase by $800 million for post-secondary education and by $250 million for development of child care spaces. The CST is extended to 2013-14, and will grow by 3% annually as a result of an automatic escalator, effective 2009-10. Federal support for post-secondary education, social programs, and children are notionally earmarked based on provincial spending patterns to make the federal contribution through transfers more transparent. Transition provisions will ensure that no province or territory experiences declines in either its CHT or CST cash relative to what its cash transfers would have been in 2007-08 prior to the implementation of the new Equalization program and the move to equal per capita CST cash support.
In addition, Budget 2007 provided provinces and territories with additional funding of $2.4 billion through three third-party trusts to support important initiatives in areas of shared priority: $1.519 billion for clean air and climate change; $300 million for the immunization of girls and women against cancer of the cervix; and $612 million to accelerate the implementation of patient wait times guarantees. |
| 2006 |
September: Budget provided $3.3 bilion through five third-party trusts to help provinces and territories deal with immediate pressures in post-secondary education ($1 billion), affordable housing ($800 million), Northern affordable housing ($300 million), off-reserve Aboriginal housing ($300 million) and public transit capital ($900 million).
May: Budget replaced the ELCC Initiative with the new Universal Child Care Benefit (UCCB), which provides direct support to parents through monthly payments of $100 for every child under the age of 6, effective July 1, 2006. Funding was provided to provinces and territories under the ELCC Initiative for 2005-06 (through a third-party trust) and 2006-07 (directly to provinces and territories) prior to termination of the agreement. |
| 2005 | March: Budget introduced a new Early Learning and Child Care (ELCC) Initiative, providing $5 billion over five years (2005-06 to 2009-10) primarily to provinces and territories to support development of a national ELCC framework outlining principles, objectives and reporting requirements. |
| 2004 |
September: First Ministers signed the 10-Year Plan to Strengthen Health Care. In support of the Plan, the Government of Canada committed $41.3 billion in additional funding to provinces and territories for health, including $35.3 billion in increases to the CHT through a base adjustment and an annual 6% escalator, $5.5 billion in Wait Times Reduction funding, and $500 million in support of medical equipment.
April: The CHST was restructured and two separate transfers were created, the Canada Health Transfer and the Canada Social Transfer.March: Budget announced additional funding under the CST for early learning and child care of $75 million in each of 2004-05 and 2005-06; funding would reach $350 million starting in 2007-08.January: The Government of Canada committed $2 billion through the 2004 CHST supplement for health, notionally allocated equally over 2004-05 and 2005-06. |
| 2003 |
March: Budget announced $900 million over five years in increased federal support for ELCC. On March 13, 2003, federal and provincial Social Services Ministers reached an agreement on a framework to improve access to ELCC programs and services. In 2003-04, funding was provided through the former Canada Health and Social Transfer CHST and in subsequent years through the CST.
February: In support of the February 2003 First Ministers' Accord on Health Care Renewal, Budget confirmed: (1) a two-year extension to 2007-08 of the five-year legislative framework put in place in September 2000 with an additional $1.8 billion; (2) a $2.5 billion CHST supplement, giving provinces the flexibility to draw down funds as they require up to the end of 2005-06; and (3) the restructuring of the CHST to create a separate Canada Health Transfer and a Canada Social Transfer effective April 1, 2004, in order to increase transparency and accountability. |
| 2000 |
September: First Ministers agreed on an action plan for renewing health care and investing in early childhood development. The Government of Canada committed to invest $21.1 billion of additional CHST cash, including $2.2 billion for early childhood development over five years.
February: Budget announced a $2.5 billion increase for the CHST to help provinces and territories fund post-secondary education and health care. This brought CHST cash to $15.5 billion for each of the years from 2000-01 to 2003-04. |
| 1999 | Budget announced increased CHST funding of $11.5 billion over five years, specifically for health care. Changes were made to the allocation formula to move to equal per capita CHST by 2001-02. |
| 1998 | CHST legislation put in place a $12.5 billion cash floor beginning in 1997-98 and extending to 2002-03. |
| 1996 | Budget announced a five-year CHST funding arrangement (1998-99 to 2002-03) and provided a cash floor of $11 billion per year. For 1996-97 and 1997-98, total CHST was maintained at $26.9 billion and $25.1 billion respectively. Thereafter the transfer was set to grow at GDP-2%; GDP-1.5% and GDP-1% for next three years. A new allocation formula was introduced to reflect changes in provincial population growth and to narrow existing funding disparities, moving halfway to equal per capita by 2002-03. |
| 1995 | Budget announced that, starting in 1996, EPF and CAP programs would be replaced by a Canada Health and Social Transfer block fund. For 1995-96, EPF growth was set at GNP-3, and CAP was frozen at 1994-95 levels for all provinces. CHST was set at $26.9 billion for 1996-97 and $25.1 billion for 1997-98. CHST for 1996-97 was allocated among provinces in the same proportion as combined EPF and CAP entitlements for 1995-96. |
| 1994 | Budget announced that total CAP and EPF transfers in 1996-97 would be no higher than in 1993-94. |
| 1991 | Budget extended the EPF freeze and CAP growth limit, introduced in 1990-91, for three more years to 1994-95. |
| 1990 | Growth in CAP transfer for three non-Equalization provinces (Ontario, Alberta and B.C.) limited to 5% annually for 1990-91 and 1991-92. The EPF per capita transfer was frozen for 1990-91 and 1991-92 for all provinces. |
| 1989 | Budget announced that EPF growth would be further reduced to GNP-3% beginning in 1990-91. |
| 1986 | EPF growth was reduced from GNP to GNP-2% indefinitely. |
| 1984 | The Canada Health Act was enacted. EPF funding was conditional on respect for the five criteria of the Canada Health Act (universality, accessibility, portability, comprehensiveness, and public administration) and provisions for withholding funding were introduced. |
| 1983 | The post-secondary education portion of EPF was limited to 6% and 5% growth for 1983-84 and 1984-85 under the "6&5" anti-inflation program. |
| 1982 | GNP per capita escalator would be applied to the total EPF, rather than EPF cash. |
| 1977 | Established Programs Financing (EPF) was introduced, with federal funding to be provided in equal parts through a tax transfer and a cash transfer. EPF replaced cost-sharing programs for health and post-secondary education. Provinces received 13.5 percentage points of personal income tax (PIT) and 1 percentage point of corporate income tax (CIT), including some points carried over from the previous post-secondary education program. The value of the transferred tax points was equalized. The value of the tax points was to grow as economies expanded, and the cash transfer was escalated by the growth rate of per capita GNP. EPF was to be distributed equal per capita over time. |
| 1966 | Canada Assistance Plan (CAP) introduced, creating a cost-sharing arrangement for social assistance programs. Conditions attached to federal funding. |
