The Standing Committee on Social Programs notes that the Minister will be coming forward with a supplementary appropriation to implement a 60/40 split with the health authorities on deficit reduction. This still means that each of the health authorities is responsible for 40 percent of their accumulated deficits with the exception of the Lutselk'e and Deninoo Boards, who will have any deficits wiped out prior to amalgamation with another health authority. Members also noted that the Minister stated that the new Sahtu Health Authority's share of the Inuvik Regional Health Authority's deficit would be the subject of negotiation. Members found it perplexing that the department would contemplate forming a new health authority in a deficit position.

The Minister's action plan calls for clarifying roles and responsibilities between the department and the health authorities by February 2003. The action plan also calls for the design and implementation of a revised funding model for the health authorities by April of 2004.

Members of the committee point out that the action plan makes it clear that accountability and fiscal frameworks for the health authorities are under development. There appears to be nothing to prevent the health authorities, under the current frameworks, from running up a further deficit prior to the implementation of accountability frameworks or funding formulas called for in the action plan.

The Minister asserts that the 60/40 split on the deficits of the health authorities coupled with the implementation of the action plan will effectively wipe the slate clean for each of the health authorities and provide them with a fresh start. The Minister also implied that the health authorities would be responsible for their own deficits less agreed forced growth increases.

Members are concerned that some health authorities, either before or after the implementation of the action plan, may initiate programs that put the authority into a deficit position. The point is ultimately the Department of Health and Social Services is responsible for the deficit that any of the health authorities accumulate. The government and the department cannot allow any health authority to cut essential services to the public to deal with a deficit financial position.

The standing committee looks forward to receiving copies of each of the health authorities' deficit recovery plans incorporating the 60/40 split on accumulated deficit.