print this page

Public services affect all of our lives and help create a fair and progressive society.

Emergencies like the ice storm, SARS, the Walkerton water tragedy, BC forest fires and the power outage in Ontario demonstrate the importance of having strong and reliable public services.

Recent studies released by Statistics Canada indicate that publicly-owned infrastructure also improves our economic performance in the business sector. For every $1 increase spent on infrastructure, an average of approximately 17 cents of cost-savings was generated for businesses each year from 1961 to 2000.

We have a responsibility to protect not only our public services but also to fight for improved quality and universal access.

Today, public sector services are being threatened on various fronts: tax cuts/program cuts, privatization and globalization.

Over the last 10 years, various federal and provincial governments have deliberately chosen to undermine our public services. Fundamental programs like capital infrastructure (roads, water and sewage treatment), mass transit, energy generation, education and public health care are suffering from chronic under-funding. Federal government spending on public services declined by almost five per cent in Canada between 1992 and 2002.

Chart I: Program expenses as % of GDP

Through tax cuts and trade deals, the federal government is pursuing economic policies that promote privatization and open the door for international corporations to take control of our public services.

Privatization threatens the quality and safety of public services and reduces our control. International trade agreements would allow foreign investors access to North American Free Trade Agreement (NAFTA) dispute procedures, which put corporate interests ahead of the public interest. Our public health care system, hydro and energy-producing facilities, water treatment plants and education system are all at risk.

The federal government and most of the provinces have sharply reduced corporate tax rates. Those reductions have been reflected in declining public services. From 2000 to 2008, corporations will see their taxes reduced by 13 per cent. In 2008, Canadian firms will pay 6.2 per cent less in corporate taxes than US firms.

Chart II: Corporate Income Tax Rates (Canada) 2000-2008

Among G-7 countries, only Italy has lower tax rates on capital gains than Canada.

Chart III: Capital Gains Tax Rates Across G-7 Countries

In the spring of 2000, then Finance Minister Paul Martin cut the proportion of capital gains income tax from 75 to 66 per cent. In the fall of 2000, just before the federal election, Martin cut the rate even further to 50 per cent. The two cuts amounted to $310 million for corporations.

Martin went on to cut personal income taxes, with the largest share going to individuals who earn the most. Between 1989 and 2001, only the top 20 per cent of Canadian families saw an increase in their real incomes. The rest of us either suffered a loss in income or our incomes remained unchanged.

Generous tax cuts for the richest Canadians mean less money to provide key social programs we have come to depend on. Growing inequality is due to cuts in social transfers that reduced the equalizing effect of social programs, and to income growth among the richest.

Chart IV: Family Income Inequality - 1989/2001

Federal government funding cuts have affected a wide range of public services and increased the pressure both on employees delivering the services in those sectors and those who rely on those services. Funding for training and universities are but two examples.

Cutbacks in federal transfers to provinces have resulted in rapidly increasing university tuition fees. Average tuition fees for university students have increased from $1,464 in 1990 to $3,405 in 2000/01. 

Chart V: Higher Education Costs

As the federal government withdrew from training, federal expenditure on training has taken a dramatic hit. From a peak of over $2 billion in 1993 federal expenditure on training was reduced to only $440 million by 2000.

Chart VI: Investment in Training

Health care is an important example of the crisis in public services. Our Medicare system is under attack. At a time when health care demands are increasing due to an aging population, there are strong pressures to reduce costs or constrain spending growth. Privatization of health care is often touted as the solution, particularly by the private, for-profit, health care industry that wants to get a bigger cut of the estimated $110 + billion spent on health care in Canada each year.

We have been conditioned by stories in the media to believe there are tremendous problems in our health care system. Our system is often portrayed as a system of the verge of collapse. That, in fact, is not the case. In a survey of Canadians, most were happy with the health care they received. The map shows that more than 8 out of every 10 people (age 15 and over, who spent at least one night hospitalized) felt they had received good or excellent services. Of course, that does not mean Canadians don’t recognize that the pressures the system is under must be addressed. Canadians do want to see improvements. The question is how? 

ap: Canadians feel they had good or excellent heath care while in hospital

The fastest growing cost in our health care system is prescription drugs. From 1987 to 1996, the cost of prescription drugs increased by 93 per cent in Canada, compared to overall inflation of 23 per cent. In part, this is related to changes made by the Conservative government of Brian Mulroney in 1993 to provide much longer patent protection on medications to the brand-name pharmaceutical companies. The major pharmaceutical companies now have a minimum 20-year patent on each medication, which prevents generic drug makers from offering a cheaper alternative. 

Chart VII: Drug Cost Growth

Much of the public criticism of the public health care system has focused on waiting lists and reported increases in the time it takes to receive some services, particularly diagnostic services and non-life-threatening elective surgeries. The debate is fuzzy in part because there do not appear to be reliable data. There is not a nation-wide or even province-wide waiting list for most procedures. With the exception of organ transplants, cancer care, and heart treatments, waiting lists are only managed at the regional, hospital or doctor level. In his report on the Future of Health Care in Canada, Roy Romanow recommended creating centralized waiting lists, standardizing criteria, and sharing information with patients about the expected wait times for specific procedures.

Prevention and wellness are important parts of Canadians’ health care picture.

Income inequality is an important determinant of health. Health problems are associated with lower income. For a healthier society, we need to reduce the income gap between the rich and the poor. We need full employment with decent wages and working conditions.

The environment is another determinant of health. The air we breathe, the water we drink, and the food we eat all affect our health.

The promotion of physical fitness among children and adults is yet another important aspect of a good health care system.

Tommy Douglas envisioned a public health care system that combined all medical services. First, he made hospitals public, then doctors’ payments. He expected that dental services, vision care, prescription drugs, home and long term care would come next, and also to be covered by government programs.

There are still many necessary health care services that are not covered by our current Medicare system. 

Chart VIII: Who Pays for Medical Care

Through new medications and procedures, patient stays in hospitals have been dramatically reduced. On the surface, it sounds good. The problem is that patients are sent home without any care support. Home care expenses are growing rapidly and the individual has to carry the cost.

Long-term care is another example where the individual is carrying the financial burden of health care costs. As our population ages, we are discovering that we do not have the support we need to stay at home (through home care). Long-term care facilities are also under-funded and difficult to access.

Public Private Partnerships, or "P3s", are the latest form of privatization. To address the growing need to invest in public infrastructure, while at the same time pursuing tax cuts and avoiding deficits, various governments have experimented with the idea of letting private entrepreneurs build schools, hospitals, roads and water treatment plants. The private sector finances the capital cost of construction, then leases the facility to government (or sometimes even operates them on behalf of government).

The rhetoric around P3s can sound appealing, but in fact P3s often actually cost taxpayers more than the traditional approaches, and they often are linked to further privatization or erosion of public services.

Governments at all levels in all parts of the country have been cutting back on public services. The list of cut-backs is long and wide-ranging: everything from education, child care and health care to environmental regulation and roads and bridges, as well as public transportation systems.

How should Steelworkers respond to the pressures on our public services? Are there any priority issues we should focus on at the bargaining table? Are there any specific items that we should strive for in the legislative area?

The following are a series of recommended actions, policy statements, or principles, that, if adopted by the National Policy Conference, will guide our union.

This policy conference proposes the following action plan to support public services at the bargaining table:

1. We will advocate for, participate in and support chain and sectoral bargaining in the security, transportation and health care sectors to guarantee that skills, wages and working conditions are removed from competition among employers;

2. Our union will work to negotiate the following language into our collective agreements...

"The union and the employer recognize the fundamental role of the medical services and benefits provided under the Canada Health Act and the provincial health care systems in providing health care to employees. The employer agrees to provide benefits under the employer’s group insurance plan for any drug, service or benefit for which coverage is reduced or eliminated (delisted) under the provincial health insurance system after the date of the ratification of this agreement."

 

3. Our union will seek the support of employers to strengthen Medicare at the bargaining table through a letter writing campaign;

4. Our union will negotiate from employers the resources needed to support a public campaign in support of a strengthened Medicare;

5. Our union will work with our partners and allies to build public pressure on governments to improve our health care system. In particular, we call on governments to:

a. Immediately and convincingly begin to implement the recommendations of the Romanow report;

b. Adopt policies of prevention and promotion of health as central planks of a comprehensive view of health care;

c. Recognize that income inequality is a primary determinant of health, and to take steps to address such inequities;

d. Create a national prescription drug plan, based on the principles of Medicare;

e. Undertake a full review of the Drug Patent Act in order to ensure easy access and affordable costs for drugs and medical devices in Canada, and to ensure quicker entry of generic drugs;

f. Affirm that health services will be excluded from all international trade agreements.

6. Our union will be active and participate in coalitions with parents’ organizations, students groups and workers in the education sector to increase funding for public education at all levels; to stop increases in university and college tuitions; to fight any preferential tax treatment of private education institutions; and to prevent any streaming of working class and poor children into second-rate schools;

7. We will defend and promote public not-for-profit services like Medicare, education, water treatment, energy supply, roads and highways, transportation, ambulances and firefighter services;

8. We will endorse municipal, provincial, territorial and federal political candidates who support public services, who are committed to increasing their quality, and who will guarantee universal access.