The Canadian Institute for Health Information (CIHI) has released its 23rd annual report on health spending in Canada - National Health Expenditure Trends, 1975 to 2019. As a member of the CIHI National Health Expenditures advisory panel, it is always great to see the wealth of data on trends in health spending across Canada. Total health spending in Canada in 2019 is expected to reach $264.4 billion which represents an increase of 3.9 percent over last year and accounts for 11.6 percent of Canada’s GDP – a figure also up slightly from last year. After a period of zero average annual growth in real per capita total health spending from 2010 to 2014, the period since 2014 has averaged about 1.4 percent a year. This, however is lower than the average annual growth rate from 1996 to 2010 which was at 3.3 percent. Health spending growth has resumed but on what currently seems like a more sustainable trajectory given that real per capita GDP growth is closer to 2 percent.
Much of the concern about rising health spending has focused on the effects of population aging. Health spending does rise with age as Figure 1 below shows rather dramatically. Aside from those aged less than 1-year, per capita provincial/territorial government health spending is well below $5,000 until the 60-64 age group when it starts to rise above that threshold reaching over $30,000 for those aged over 90 years. Yet, despite this surge after age 60, what is also interesting is that when the drivers of rising health spending are broken down, in 2019, aging per se only contributes 0.8 percentage points out of the 3.8 percent growth in public sector health spending – about 21 percent – with general inflation, population growth and other factors (eg. Technology and utilization) accounting for the rest. It does lead one to wonder whether this is because today’s seniors are generally quite healthy compared to the past or perhaps whether there are unmet needs.
What is also interesting and seldom noted is that while provincial and territorial government per capita health spending is highest among seniors, over the last two decades, the rates of growth in per capita spending have not been for seniors. Indeed, between 2000 and 2017, the highest average annual growth rates have been for children and youth aged 5 to 19, followed by children under age 1-year and adults aged 35-39 as shown in Figure 2.
Indeed, per capita spending for adults between the ages of 35 and 64 has been growing at a faster rate than those aged 65 to 89. While, it is true that much lower per capita amounts are being spent on those below age 65, spending for this demographic has been growing much faster. Again, this leads one to wonder given scarce resources whether there is an implicit transfer of resources underway away from seniors when it comes to new growth or whether younger people today have more health problems or utilize health care more than similarly aged groups in the past. Given the epidemic of obesity and mental health issues among the young, perhaps this is having an impact on health spending needs and expenditures.
If a significant cohort shift in health care needs and utilization is underway is an interesting question. I suppose fully knowing if this is a recent development or has been underway for the last 50 years requires per capita age spending data going back quite a ways - I am only aware of the CIHI data going back to the mid 1990s or so. This is an important issue. While an aging population may only be contributing 21 percent of the increase in health spending now, if younger cohorts today have deteriorating health status or more health issues than in the past, they may be poised to be a more important driver of health spending both now and in the future.
Northern Economist 2.0
Saturday 2 November 2019
Friday 25 October 2019
The City of Thunder Bay Has Spoken, The Case is Closed
Thunder Bay City Council
and its municipal administrative apparatus seems to have embarked on its Roman imperial
phase with respect to community relations with its taxpayer base. In response to those who provided input ( my
input here ) on the 105 Junot Avenue South Rezoning application and following
the October 21st decision to uphold the rezoning in a 7-5
vote, the Office of the City Clerk provided a Notice of Passing decree that
begins as follows:
“The Thunder Bay City Council passed By-law 94/2019 on the 21st
day of October 2019, under Section 34 of the Planning Act, R.S.O. 1990 as
amended.
Public comment has been received and considered
and had no effect on Council’s Decision as the application is consistent with
all relevant planning legislation and represents good planning.”
I suppose all that was
missing at the end of this statement was a simple “All Hail the Glory of the Emperor”
to convey the full message of conquest and victory. The implied message seems to be that any resistance
to the edicts of City Council is futile and has no effect. Whatever
is decided is consistent, represents good planning, and the final collective decision
is ultimately infallible.
The entire public
drama and division over 105 Junot was amplified by The City of Thunder Bay
because they encouraged the Ontario Aboriginal Housing Corporation to expand
the scale of the transitional project from 20 to 58 beds to “maximize” the use
of the site which one suspects probably really means greater property tax revenues for
the City - assuming that the OAHC pays property taxes. A smaller scale facility more
in keeping with other such projects around the province would have been more
suitable given the many concerns raised by residents in the area and generated
less discord.
Unfortunately, the
Aboriginal Housing Corporation was caught in the middle of this unfortunate
situation and making it into an emotional issue that attracted the attention of
the Globe
and Mail
did not serve anyone’s long-term interests.
What the City of Thunder Bay should have done in response to the input
received was return to the original proposal of 20-beds but that would have
required actually listening and accepting at least some of the arguments made
by those who presented their concerns. Really,
how can a facility approved on a much larger 58-bed scale in a neighborhood
with the social and crime issues that were raised be “good planning?"
In the end, it is
water off a duck’s back because many members of council believe they have been
annointed as “progressive” thinkers who love their community. The strength of their love means that they are
doing good and therefore the ends always justify the means. If that means tacitly implying that opponents
to their good works are insensitive to poverty or diversity, then so be
it. They constantly solicit input from constituents
but listen through a set of political noise cancelling headphones so that the
discordant notes from any input not coinciding with their vision of fighting
social and economic injustice is politely filtered out.
Those in Thunder Bay who
uncritically champion all social injustice issues with unquestioned fervour and
feel they have the ear of City Council and its municipal-corporate apparatus
should be cautious. In the end, any dispensed
progressive works are to be accepted on The City’s terms because they know what
is best for you. Take the example of
Dease Pool as a case in point. Here, a
long-standing community pool in what is considered a disadvantaged neighborhood
was closed because it was old and needed substantial and expensive
renovations. There is continuing opposition
to the closure but The City forges ahead.
The proposed new draft
plan (available here) will
essentially replace the pool area with a tennis court and a community
garden. Given that swimming pools accommodate
a greater and more diverse number of users than a single tennis court, it seems
like an oddly elitist rather than progressive use for the site. However, consciences will be soothed with a multi-user
community garden – which also atones for the environmental sin of an asphalt
surface on the tennis court. If all this
redevelopment was designed to somehow deal with the rising costs of an old and
aging pool, those of us with a more fiscally conservative bent could be understanding. However, this will still cost a lot of money and in the end not fully serve the
needs of the area.
As for the money that
will be spent, it does not seem to matter because a “progressive” council that wants to
do great things will simply raise the tax rates on its residents - who by the
way are now responsible for the lion’s share of property tax revenue given the
declining industrial and commercial base.
Be prepared this year for an initial budget proposal that stakes out a high
increase in the tax levy. This will be blamed
on the provincial government who, being conservative rather than progressive,
are the source of all fiscal evil. After
a cleansing public ritual of debate and input of appropriate length, The City will then retreat
to an increase of between 3 and 4 percent thereby demonstrating that it is both
fiscally responsible and generous in matters of expenditure.
We should not complain
too much. We elected them.
Wednesday 23 October 2019
The Federal Election Results: Northern Ontario
The people have spoken,
and Canada has a minority Liberal government.
In my home community of Thunder Bay, there will be double representation
on the government side as both ridings went Liberal. This however was not the result of strategic voting
or a calculated decision by the local electorate to go with what they saw as
the winning side but the outcome of ingrained behaviour. Thunder Bay always votes Liberal at both
federal and provincial levels except on occasion when it goes NDP because the
voters feel the Liberals ought to be punished.
However, their NDP support is a temporary dalliance and they ultimately return
to their original faith.
If Monday’s election had yielded a Conservative minority or majority, then Thunder Bay would have been on the outs and of course complaining incessantly about the lack of government attention. Yet, loyalty to one party by a smaller and more remote community does not always ensure you will get what you want if your team is in power. If your support is always assumed to be there, than that can also work against you when it comes to getting your issues on the table.
If Monday’s election had yielded a Conservative minority or majority, then Thunder Bay would have been on the outs and of course complaining incessantly about the lack of government attention. Yet, loyalty to one party by a smaller and more remote community does not always ensure you will get what you want if your team is in power. If your support is always assumed to be there, than that can also work against you when it comes to getting your issues on the table.
Electing a variety of
representatives over the years based on calculation rather than political faith
or loyalty is another approach to collective voter wisdom and diversity in
outcomes over time is one way of ensuring your support is not taken for
granted. While Thunder Bay generally always
votes the same way, nearby Kenora is much more flexible and over the years has
voted in representatives at the provincial and local level affiliated with all
three of the major parties. This time,
they switched from Liberal to Conservative at the federal level.
While parts of
northern Ontario seem to be closed shops when it comes to voting patterns, the
region as a whole, has actually elected a diverse portfolio of representatives with the balance what one might term centre-right rather than
centre-left - if you assume the Liberals are more centrist than the other two
parties. Given that the Liberals and NDP
generally term themselves as “Progressive” the region as a whole is probably more
centre-left. One can only imagine what
the “Progressives” would now term themselves if the federal Conservatives had
not rebranded and retained their “Progressive Conservative” label.
In terms of results
for the 10 ridings, they are:
Kenora: Conservative
Thunder Bay-Rainy River:
Liberal
Thunder Bay-Superior North:
Liberal
Timmin-James Bay: NDP
Algoma-Manitoulin-Kapuskasing:
NDP
Sault Ste. Marie: Liberal
Nickel Belt: Liberal
Sudbury: Liberal
Nipissing-Timiskaming:
Liberal
Parry Sound-Muskoka: Conservative
On a map, electoral northern Ontario is a bit of an oreo sandwich made up of two conservative graham wafer borders -Kenora and Parry Sound-Muskoka - and a rather large dollop of Liberal cream accented with some additional NDP filling. Obviously, northern Ontario voters as a whole like their electoral food spiced with diversity even if smaller regions within prefer more monotonous diets. However, if one takes a pan-northern view, the north is greater than the sum of its local parts when it comes electoral wisdom and has made sure it has its bases covered.
On a final note, a special congratulations to Eric Melillo who pulled ahead of incumbent Bob Nault to win the Kenora riding. Eric is a graduate of the Economics program at Lakehead University and I am thrilled to see him do well. Eric was a hardworking and keen student in Economics and a very pleasant young man and I wish him all the best.
Sunday 20 October 2019
Which Federal Party Can Open the Door to Thunder Bay's Employment Growth?
With the federal election into
its home stretch and the vote scheduled for tomorrow, voters in Thunder Bay have
to decide who to vote for. Needless to say,
it has been a disappointing election given that the major parties – as well as
the smaller ones – have presented grandiose expenditure visions that are for
the most part fiscally unsustainable. Moreover,
much of the campaign has been not on policy but on opportunistic promises with major efforts expended
on digging up dirt on opponents, mixing it with a little self-righteous water and then spattering
it about in the hope that it sticks somewhere.
When it comes
to making a ballot-box decision, the prevailing sentiment on the street seems
to be that it is hard to choose from a set of equally unpalatable national parties. So, the next best approach might be: let us look
locally and make the decision, based not on what might be best for the country,
but what might be best for Thunder Bay. Here too, the answer is really quite muddy as
ultimately what is best for Thunder Bay is making sure that at least one of the
ridings is with whoever ends up as the governing party. However, even that is a difficult game to
play given that we are probably looking at a minority government situation. And such strategic behaviour is made even more difficult by Thunder Bay's historical genetic aversion to any federal choice but Liberal - except when they seek to punish the Liberals by voting New Democrat. Thunder Bay has not elected a federal conservative since the 1930s but then oddly wonders why conservative governments do not grant its wishes.
In terms of what is
best for Thunder Bay, needless to say a government that promotes economic
growth and diversification is always a safe bet but that can often only be judged
years after the fact. The current north
side incumbent who is also a member of the present governing party certainly
points to the last four years as a period of economic growth for Thunder Bay and northwestern
Ontario in part due to the “millions
of dollars coming into our area” which she no doubt ascribes to her
government and her role as a Minister of the Crown.
Quantitatively assessing
growth in Thunder Bay and the region is never easy but a glance at employment
numbers is one way of providing an evidence-based attempt on how much growth
there has been. Between 2014 and 2018,
total employment in Thunder Bay has indeed grown by 3.6 percent – from 61,500
to 63,700 jobs – which is actually not bad given that Ontario over the same
period increased by 5.3 percent.
However, when employment is examined in a longer-term framework using
the period from 2001 to 2018 – see Figure 1 – it is still within the
traditional employment range of the last two decades. We basically bounce up and down between
60,000 and 65,000 jobs and never seem to break out of that corridor in any
sustained fashion. Between 2001 and
2018, Thunder Bay’s employment grew 3.4 percent while Ontario grew 22
percent.
What is also
interesting as shown in Figure 2 is when employment growth by occupational category over the period
2014 to 2018 is examined. The most employment growth since
2014 has been in occupations related to arts and culture (26.7%), health
(22.2%), natural and applied sciences (17.6%), manufacturing (13.3%) and law,
social and government services (12%).
However, sales and services, business and finance, and construction have
all seen declines. As for the manufacturing
resurgence, given the 550 jobs slated to disappear at Bombardier, manufacturing
is poised to continue the decline that has been underway since 2001.
So, has Thunder Bay’s
employment grown over the last four years?
Yes, but there are important qualifications given the dynamic nature and
unique features of any local economy. Here in Thunder Bay jobs are both created and
destroyed but in almost perfect balance over time so as to keep total
employment locked within a narrow corridor.
This corridor has remained the same for decades and Thunder Bay remains
in an overall total employment stasis despite the efforts of two growth plans - one provincial and the most recent federal. This
is unlike Ontario as a whole where jobs are both created and destroyed but on
net over the last 20 years many more jobs have been created than have been
destroyed. In choosing who to vote more
tomorrow, voters need to think long and hard on which party they believe can actually open the door to getting us outside our historical corridor of
employment stasis.
Friday 11 October 2019
Why Understanding Crime Numbers Is Important for Public Policy
The meetings
currently underway in Thunder Bay for police service boards and chiefs is
focusing on challenges facing the north and in particular those dealing with
guns, drugs and gangs. In particular,
the lack of funding for addressing what is perceived to be escalating crime is
a major grievance given that the federal government has transferred money to
the Ontario government to fight gangs, drugs and gun related activity but to
date the province has apparently only chosen to assist Toronto and Ottawa. Jeff McGuire, executive director of the Ontario
Association of Chiefs of Police, is in Thunder Bay for the meetings and stated:
“I think the government had the right
intentions, there were serious guns and gangs issues going on at that moment in
Toronto and GTA area. Members of OACP were quick to point out it’s not just a
GTA challenge.”
What is interesting when looking at this issue is
taking a look at the violent crime statistics.
Figure 1 plots total violent crimes from 1998 to 2018 for Thunder Bay, Toronto
and Ottawa. If a provincial government politician
handing out money to fight growing violent crime is deciding on where need was
most urgent based on Figure 1, they would automatically judge that need was
greatest in Toronto. Toronto not only has the most violent crime
incidents of the three cities but also what seems visually to be a rapidly
escalating problem since 2015 - which by the way was preceded by a long
decline. Indeed, after a period of
decline, all three cities have seen an increase in total violent crime largely
related to increased gang and drug activity, but Toronto has the most violent
crimes, followed by Ottawa and then Thunder Bay.
However, making the
decision only based on total volume misses the point that crime is not only
about total scale but also intensity relative to the size of local populations.
Toronto and the GTA does indeed have the most violent crime, but it also
accounts for almost half of Ontario’s population. What is also relevant is crime per person or per capita which adjusts for total population size.
Figure 2 plots the number of violent crimes
per 100,000 population and here the difference is startling. While all three cities have seen an increase
in violent crimes per capita over the last three years, Thunder Bay’s rate is
practically double that of either Ottawa or Toronto. Its policing numbers and resources per capita
are definitely not double those of either city.
Some help is obviously needed.
The provincial
government does need to address the local policing situation though as has been
noted, more money alone will not solve the problem. We need to understand why it is that after
years of decline, violent crime in all three cities is now trending
upwards. As was noted by Jeff McGuire,
there are other issues to be addressed including mental health, poverty and
firearm access. Nevertheless, a good start would be understanding the
distinction between totals and per capita amounts and making it part of any decision making process that allocates new resources.
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