The government also receives a significant amount of income from Canada's payment for hospital and medical care costs for Indians and Inuit. At the end of March 2001 and March 2000, Canada owed the government $19.3 million and $26.5 million respectively. The Auditor General pointed out that this is tantamount to lending the federal government money interest free. As a rough estimate for the two years, at a nominal 5 percent, the cost or loss in interest income to this government would be more than $1 million.
The Department of Health and Social Services explained that it did not receive funding from Canada on a timely basis as its agreement with the federal government was not signed until late into 1999-2000 and thus it could not bill monthly. Further, the required audit for the 1999-2000 claim year had not been completed and as such, Canada held back payments for the 2000-2001 fiscal year.
The Office of the Auditor General recommended the government reach an interim billing agreement with Canada to better manage its cash flows, and the department should review its processes to ensure claims are finalized and audited on a more timely basis. The Auditor General did not encounter any federal regulation that would prohibit DIAND from entering into such an agreement.
The committee and the Auditor General encourage the department to enter into an interim agreement with DIAND for the timely reimbursement of hospital and medical care costs for Indians and Inuit. Committee members stated there is no reason the GNWT should fund the program. Timely reimbursement is especially important given the government's forecast cash deficit. The government advised that they are requesting an interim funding agreement with DIAND be put in place. At the time of the review, the government had not received a response. Mr. Speaker, I seek your consent to have my colleague from Range Lake continue with the committee report.