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> Tax Point Funding: A Predictable and Growing Resource
> 
> The reforms outlined above would result in a significant
> decentralization in the way these dollars are spent. Once completed,
> provinces would be responsible not only for the design and
> implementation of most social programs, but also for funding them. It
> is vitally important that Ottawa gives the provinces the means with
> which to pay for their increased responsibilities.
> 
> By ceding further tax room to the provinces to fund health care,
> education and welfare, the Reform Party plan guarantees that
> provincial governments will enjoy an expanded and constantly
> increasing revenue base from which to fund these programs.
> 
> As the Minister of Human Resources Development noted in his green
> paper, federal cash funding for health and education has been in
> decline since the late 1980s. This is traceable to two factors. First,
> the federal government has unilaterally changed the terms under which
> it transfers funds to the provinces and has capped some transfers.
> Second, the growth of tax transfers under the program has eaten away
> at cash transfers. Under the current arrangements, cash transfers in
> support of health and post-secondary education under the EPF program
> will have dropped to zero the year 2010 (see Chart 5 p. 47).
> 
> Under our proposals to give additional tax room to help fund
> provincial programs, the provinces would actually receive additional
> revenues for health care, advanced education and welfare over the
> longer term (see Chart 6 p. 48). This is because the value of tax
> points - unlike cash transfers - continues to grow as Canada's economy
> expands.
> 
> The federal government's current block-funding arrangements do not
> address the provinces' growing long-term need for additional revenues.
> Furthermore, as provincial governments have learned to their dismay,
> there is no "guarantee." Transfers from Ottawa can be cut back at any
> time, without consultation. By contrast once tax points are
> transferred, it would be much more difficult for the federal
> government to take them back or reduce their value. An increased share
> of the total revenue from income taxes would flow directly and
> permanently to the provinces.
> 
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> [Image] hermae@parl.gc.ca