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Sun Media, Friday, December 23, 2011

In the political play of the year, Finance Minister Jim Flaherty ran a pre-emptive takeout with the provinces in his surprise announcement extending federal funding of health care for 10 years after the expiration of the current agreement in 2014.

What, no first ministers' conference?

No special meeting of finance and health ministers? Nope.

This time there won't be any pizzas delivered to 24 Sussex after midnight, as was the case in 2004, when Paul Martin and the premiers did a deal on the back of an envelope that he boasted would fix health care for a generation.

There will be no meeting of first ministers in the run-up to 2014. Chaos and improvisation are not in Stephen Harper's playbook. He's a no-drama kind of guy.

The meeting, such as it was, was called with no notice by Flaherty, over lunch at the annual finance ministers meeting in Victoria on Monday.

In the morning, they talked about transfer payments to the provinces, $59 billion in the next fiscal year, an all-time high.

They talked about the Canada Social Transfer, which will grow at 3% through to 2024.

They talked about Pooled Registered Pension Plans (PRPP), which they agreed on a year ago.

They talked about the Canada Pension Plan, which they agreed is amply funded going forward, with no need to increase the contribution rate.

What they hadn't expected to talk about was federal funding of health care, which is delivered by the provinces. It wasn't even on the agenda, until Flaherty pulled the federal announcement out of his pocket at lunch.

And that's what it was, an announcement, not a negotiation. A fait accompli. Take it or leave it. Then Flaherty went out and told the media what he had just told his provincial colleagues. All things considered, the provinces will take it, because $178 billion over five years would be a lot of money to leave on the table.

Federal health-care investments will grow from $30 billion in 2014 to $38 billion in 2019.

What's more, health expenditures will continue to be indexed at 6% a year for the first three years, before levelling off at 3% or the rate of inflation.

Flaherty is over-delivering on the Tories' campaign promise of 6% indexing for the first two years, which effectively took health care off the table as a campaign issue.

Ontario Finance Minister Dwight Duncan was shocked and appalled by Flaherty's peremptory pre-emptive.

"This, in my view, destabilizes the federation," he protested, adding the dire prediction of "less access to quality health care from sea to sea."

And this coming from a guy whose Liberal government has doubled the province's debt, turned Ontario into a have-not province and put it on credit watch from the ratings agencies.

Then, as a followup to Monday's announcement, the Harper government sent Health Minister Leona Aglukkaq out on Tuesday with a missive to the provinces that they could deliver the service as they deemed best, without worrying about national standards, asking them "to put the divisive issue of funding behind us."

Clearly, the whole operation was quarterbacked by the Prime Minister's Office, and impressively executed by Flaherty. End of discussion, end of story.

It also reminds us that Harper is an exponent of classical federalism, not a centralizer, observant of the division of powers between Ottawa and the provinces.

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