A new research book from the Alberta Federation of Labour demonstrates that public health care and public education give Alberta and Canada a clear competitive advantage over the United States and other countries who deliver these services privately. The book, released today at a seminar, compares the economic costs and benefits of public services versus delivering those services privately.
"Advocates for privatization try to tell us that the private sector is always more efficient, and that is we want to remain competitive, we have to privatize key programs like health care, education and pensions," says AFL Secretary Treasurer Kerry Barrett. "Well, when you finally put that myth to the test, it comes up short. Public delivery is more efficient and makes us more competitive than the U.S."
"If we privatize health care and education, we harm our economy by making it more expensive for employers to do business and by lowering benefit levels to workers."
The book, titled The Other Competitive Advantage: The Economic Case for Strong Social Programs, compares the economic effects of delivering programs publicly and privately. It examines both sides of the economic picture - the cost to employers and citizens and the benefits provided. It studies five areas of public policy: health care, education, income security, retirement pensions and WCB.
"U.S. employers pay two to three times more in health payroll costs than comparable Canadian employers," says Barrett. "And for that extra money, the workers receive worse health coverage than Canadian workers."
"This is only one example of how our tradition of publicly delivered social programs makes doing business in Canada cheaper and more efficient," adds Barrett.
The book shows that public health care lowers employer costs, even when income taxes are taken into account. Workers pay less out of pocket for health expenses in a public system, and the overall effectiveness of the health system increases when it is operated publicly.
Education has similar effects. Public education operates 16% cheaper than private schools and delivers equal or better quality education.
Other highlights of the book include:
- Public health care lowers labour costs for building vehicles by $6 an hour;
- An effective unemployment insurance system shortens and softens recessions, helping to save jobs during economic hard times. In the 1991/92 recession, 30,000 jobs were saved by UI;
- Public pension plans operate more efficiently, with administration costs at a fraction of private pension schemes;
- Private WCB premium rates are double public WCB, and benefit levels are 2/3 what is offered to workers in public systems;
- High tuition limits access to post-secondary education, reducing the economic benefits of an educated workforce.
"We all want a strong economy. To do that we need to be smart, and that means not just blindly following ideological theories," observes Barrett. "We need to deliver services in the way that will be most effective, for employers and for workers."
"Businesspeople in particular should be looking at this book. Privatization will increase the cost of doing business," says Barrett. "For employers, privatization means at least $6 an hour in extra health costs, a doubling of WCB premiums, a huge increase in pension premiums and a less educated workforce."
The AFL will be distributing the book to Chambers of Commerce and large employers around Alberta. They will also be available to make presentations to business groups.
"The message of this book is simple: if you want good jobs and a competitive economy, things like health care, education and income security need to be delivering publicly," Barrett concludes.
NOTE: Copies of The Other Competitive Advantage: The Economic Case for Strong Social Programs are available from the AFL at (780)483-3021.
For more information contact:
Kerry Barrett, Secretary Treasurer @ 780-483-3021(wk) 780-720-8945(cell)
Jason Foster, Director of Policy Analysis @ 780-483-3021(wk)
Government plans to download responsibility for health care could cost Alberta businesses $500 million a year, says AFL
CALGARY - The Alberta government's plan to limit Medicare coverage will end up costing businesses in the province $500 million or more each year, says a presentation prepared by the Alberta Federation of Labour for Roy Romanow's commission on the future of health care.
"The recommendations contained in the Mazankowski report aren't just misguided - some of them are downright dangerous from an economic point of view," says AFL President Les Steel, who will be appearing before Romanow in Calgary today.
In its presentation to the commission, the AFL focuses on the impact of government plans to download health costs from the public sector onto the shoulders of individuals and businesses. In particular, the AFL says that plans to de-list services and introduce so-called Medical Savings Accounts will create a market for supplementary private health insurance.
"For those of us in the labour movement, our preference would be to maintain a comprehensive and fully funded public system," says Steel. "But make no mistake - if the Alberta government goes ahead with plans to limit what's covered publicly, then unions will have no choice but to fight for supplementary private insurance at the bargaining table. It will become one of our top priorities."
As it stands right now, Canadian employers pay an average of $93 a month for extended health benefits to cover things like dental and vision care. That compares to the U.S. where employers pay as much as $600 per employee every month for health benefits. Steel says any move to limit Medicare coverage will result in dramatic increases to benefit costs for Alberta businesses.
"There are 275,000 unionized workers in this province," he says. "So if supplementary private insurance health insurance costs another $50 per month per employee that's an extra cost to Alberta businesses of $165 million per year. If it costs an extra $100 per month, that's a cost of $330 million per year. And if it costs an extra $150 per month, that's an added cost to business of $495 million each year. And that's just the unionized workforce."
In the end, the AFL says the Mazankowksi plan will saddle Alberta businesses with hundreds of millions - many even billions - in extra, on-going costs. This will drive up the cost of doing business in Alberta; it will reduce the competitive advantage that we currently enjoy because of Medicare; and it will probably mean the loss of thousands of jobs as companies scramble to pay the bills.
"The message for the Alberta business community is clear: wake up and smell the coffee," says Steel. "They should not be supporting this government's health policy. It will be very bad for business."
For more information call:
Les Steel, AFL President @ 780-499-4135 (cell)
Gil McGowan, AFL Communications @ 780-910-1137 (cell)
EDMONTON - The budget unveiled by the Klein government late this afternoon is a "triple whammy" for working people in Alberta, says the president of Alberta's largest union organization.
As a result of the new budget, Albertans will be paying higher taxes and facing declining quality of services in areas like health care and education, says Les Steel, president of the Alberta Federation of Labour.
"Before the last provincial election, the premier wooed working peoples' votes by offering a big tax cut. A year later he's broken that promise by substantially increasing health premiums - which are a tax hike in all but name. That's the first whammy."
Steel says the second "whammy" has to do with the way the government is handling education funding.
"This budget represents a lost opportunity to resolve the dispute with the teachers," says Steel. "They could have dealt with some of the problems that lie at the heart of the dispute - like the issue of over-crowding. But by refusing to put more money into the classroom they've basically guaranteed more labour unrest."
The third assault on the interests of working people cited by Steel has to do with health care. In particular, Steel says the government has failed to make funding adjustments that reflect Alberta's growing population.
"On the surface, a seven percent increase in funding sounds great. But in reality it doesn't keep up with the combined pressures of inflation and population growth. In effect this so-called increase is actually a cut for our health care system. So much for the government's supposed commitment to Medicare."
Steel concluded by pointing out that many of the cuts announced today are a direct result of the government's "irresponsible flat tax and cuts to corporate taxes.
"We're a wealthy province but our government has basically impoverished our public sector by slashing taxes for big business and the wealthy. Today we see that it's ordinary working people who are going to have to pay for these irresponsible cuts."
For more information call:
Les Steel, President @ 780-499-4135 (cell)
EDMONTON - Yesterday's Throne Speech was much like the Conservative's recent election campaign - long on reassuring rhetoric and short on substance, says Audrey Cormack, president of the Alberta Federation of Labour.
"As usual, the government was quick to take credit for our province's strong economy - even though the current boom has much more to do with high international prices for oil and gas than that any policies adopted by the government," says Cormack.
"At the same time, they are still refusing to acknowledge that, despite our wealth, Alberta is facing a number of serious problems. For example, they are still refusing to admit that power deregulation has been a costly failure. And they are still refusing to acknowledge that classes are too large in our schools; that funding for municipalities is inadequate; and that tuition fees are too high in our colleges and universities."
Even in cases where the government promised to take action, Cormack says the Throne Speech focused on symptoms without getting at the root causes of problems.
"They talked about the need to address poverty - but they didn't talk about increasing the minimum wage. They talked about giving our children the best possible start in life - but they didn't talk about improving access to day care or reducing class size. This continues to be a government that simply cannot connect the dots."
Cormack predicts that Albertans who actually took the time to listen to or read the Throne Speech will come away feeling disappointed.
"Here in Alberta, we have been blessed with abundant resources - resources and wealth that make us the envy of the country," says Cormack. "We could be using our wealth to invest in people and build a better future for our children. But instead of progressive investment, we get tax cuts for the wealthy, deregulation and an incredibly expensive and ill-conceived rebate program. In this Throne Speech the government could have outlined a real vision for post-debt Alberta - instead all we got was platitudes. It was a wasted opportunity."
For more information call:
Audrey Cormack, AFL President at 499-6530 (cell) or 483-3021 (work)
EDMONTON - The Klein Conservatives are walking into the provincial election with their "eyes firmly shut and their ears closed to the real concerns of Albertans," says the president of Alberta's largest labour organization.
Audrey Cormack, president of the Alberta Federation of Labour, described yesterday's Throne Speech as a big disappointment. She said it proves the government has lost touch with the real priorities of citizens.
"Voters in this province have made it clear that they have serious questions about government policy in areas like health care, taxation and utilities," said Cormack after the speech was delivered by Lt. Governor Lois Hole.
"Yet, there was no mention of Bill 11 or private hospitals. There was also no recognition that government policies have contributed greatly to soaring utility prices. And there was no discussion of the fundamentally inequitable nature of the government's new flat tax."
Cormack said the Throne Speech's silence on these issues suggests that the Klein Tories are content to allow the creeping privatization of Medicare. It also suggests that the government is not listening to the thousands of Albertans who have raised concerns about out-of-control utility prices and new tax laws that favour the well-off at the expense of working families.
"This is more of what we've come to expect from the Tories: vague promises and platitudes masking a hidden agenda that favours privatization, deregulation and tax cuts for the wealthy."
Cormack scoffed at the promise of a "Future Summit" to map out a direction for the province once the government has eliminated its debt.
"This is shaping up to be another stage-managed attempt to get a rubber stamp from the public for policies that have already been decided upon," she said, adding that the government appears to be considerably less open and visionary than the school children quoted in the Throne Speech.
"I was pleased to see that 11 year-olds have a vision for the future and are concerned about things like equality, respect and protecting the environment. It's too bad this government can't come up with a similar kind of progressive vision."
For further information call:
Audrey Cormack, President @ 483-3021(wk)/ 499-6530(cell)/ 428-9367(hm)
EDMONTON - Alberta Federation of Labour President Audrey Cormack will be taking the fight against the Klein government's Private Hospitals Bill to Ottawa on Tuesday, March 7th. Cormack has a meeting with federal Health Minister Alan Rock to discuss the implications of Bill 11, introduced last week.
The meeting will take place on Tuesday, March 7 at the Minister's Office in Tunney's Pasture Complex at 2:00 pm EST (12:00 Noon Alberta time). The meeting will take between 30 and 60 minutes.
Cormack is available for media comment following the meeting. Ms. Cormack can be
reached by cellular phone at (780) 499-6530.
For more information call:
Audrey Cormack, President @ (780) 499-6530 (cell)
Jason Foster, AFL @ (780) 483-3021
The Klein government will pay a big price from Albertans if it continues with its private health care bill, introduced in the Legislature today, says Audrey Cormack, President of the Alberta Federation of Labour.
"The introduction of Bill 11 shows the Klein government is not listening to Albertans," says Cormack. "Albertans are worried - very worried - about their health care system. They want it protected and have told the government so."
"The government has responded by playing word games and weaving more lies about their real intentions," says Cormack. "Albertans don't want word games, they want Medicare protected from for-profit clinics."
"Bill 11 undermines the very principles of Medicare."
Cormack says that even the Tories know their bill is a bunch of pretend. "I don't care what you call it, a surgical facility or private clinic, this bill legalizes private, for-profit hospitals."
Cormack predicts that if the government insists on forcing this bill on Albertans that Albertans will make them pay a big price for it.
"Albertans won't put up with this bill. Any government that tries to undermine Medicare will hear loudly from Albertans. They will hear from us in the Legislature, on the streets and in the ballot box."
"If the government has any sense, they will let the bill die a quick death."
"It's not too late," concludes Cormack, "this bill can and will be stopped."
For more information call:
Audrey Cormack, President @ (780) 499-6530 cell/ 483-3021 (wk)/ 428-9367 (hm)
EDMONTON - The Alberta government's plan for the coming year - as outlined in today's Throne Speech - is based on two dangerous myths, says the President of the Alberta Federation of Labour.
The first myth is that privatization in health care will lower costs and reduce waiting lists. The second myth is that flat taxes will enhance tax fairness and prompt economic growth.
"The government has decided to make private health care and flat taxes the dual centerpieces of their agenda for the year 2000," says AFL President Audrey Cormack, "but both of these policies are deeply flawed. Bother policies will weaken the social fabric of our province."
Cormack says the government's plan to spend tax dollars on private, for profit hospitals represents a serious threat to the future of medicare.
"The government says its privatization plan will protect medicare," says Cormack "but the truth is privatization will undermine the very foundations of our public health system. Wherever privatization in health care has been tried, it has failed. All we have to do is look at the experience in places like Britain, Australia and the United States. Wherever private health care has been allowed to spread costs have gone up and waiting lists have grown longer. Given this experience, why on earth would we want to go down this road?"
Cormack says the government's plan for a provincial flat tax is also ill conceived.
"Albertans shouldn't be fooled into thinking that a flat tax will actually make the provincial tax system fairer," says Cormack "this plan will provide a big break for the wealthiest Albertans but middle income earners are going to carry a disproportionate share of the burden. The flat tax will also rob the government of hundreds of millions of dollars in revenue - revenue needed to pay for health care, education and other important programs and services."
If the government really wants to defend medicare and promote tax fairness, Cormack says they should shelve their plans for private health care and flat taxes."The answer to our problem in health care is adequate funding for our existing public system. And the answer to our concerns about fair taxation is a tax system that is more progressive, not less," says Cormack.
"By introducing a flat tax the Alberta government is abandoning one of the central principles of fair taxation. And by promoting privatization in health care they will be weakening Canada's most cherished social program. These are not bold plans for the future - they are dangerous ideas that will take us backwards not move us forward."
For further information contact:
Audrey Cormack, President: (780) 499-6530 (cell)
Premier Klein's televised address last night was a continuation of his intentional misleading of the public over his privatization experiment, says Audrey Cormack, President of the Alberta Federation of Labour (AFL). It offers nothing to make life better for working people in the province.
"He had nothing to offer working people," notes Cormack. "His attention is saved for corporations and the extremely wealthy." Cormack notes that the government's key economic plank is the flat tax, which will disproportionately benefit the very wealthy.
The only content in the speech, says Cormack, was Klein's continued misinformation about his health privatization plan. "He insists on abusing his access to the airwaves to tell half-truths and cloud his real intentions with Medicare."
"He knows as well as we do that Albertans are saying they don't want taxpayer dollars padding the pockets of for-profit hospitals," states Cormack. "His plan - as he well knows - does exactly that."
"He has promised to put $1 billion into health care over the next three years, but how much of that will go to services, and how much into the profit margins of private clinics?" asks Cormack.
Cormack observes Klein is still not hearing Albertans. "Albertans are saying to the government we don't want his privatization plan. What can be so hard about that?"
Cormack scoffed at the appointment of Don Mazankowski to chair a new Premier's Advisory Council on Health. "Klein has appointed Mulroney's hatchet man to advise on the future of health care."
Cormack points out that Mazankowski started the cutbacks to health care transfer payments in the 1980s as a Minister, including a period as Finance Minister, under the Mulroney and Campbell governments.
"Nothing for working families, tax breaks and privatized health care for the wealthy. Sounds like the same old Tory government to me," concludes Cormack.
For More Information:
Audrey Cormack, President @ 483-3021(wk) 428-9367 (hm) 499-6530 (cell)
EDMONTON - The provincial government's recently announced plan to establish a so-called Corporate Services Centre and outsource certain administrative functions is much more serious than it appears at first blush, says the president of Alberta's largest labour organization.
Audrey Cormack, president of the Alberta Federation of Labour, says the government is deliberately trying to downplay the significance of the privatization plan announced by Premier Klein yesterday - but she says it has the potential to act like an "atom bomb" dropped on the provincial public service.
"Based on the information we've been able to gather from conversations with government officials, it seems clear to us that this proposal involves much more than a small cosmetic change," says Cormack. "What they're talking about is privatizing a large portion of the day-to-day operations of all government departments. This has radical implications both in terms of jobs and the quality of public services."
According to government media statements, many of the so-called "transactional elements" of the government's day-to-day operations will be centralized in a new agency called the Alberta Corporate Services Centre. Once this has been done, many (and possibly most) of these services will be outsourced to the private sector, said government spokesperson Peter Tadman in a telephone conversation with the AFL. Tadman defined "transactional" services as all those services that don't involve policy-making or strategic planning.
"By Tadman's definition, more than 75 or 80 percent of the jobs in the provincial public service are transactional in nature," says Cormack. "That means that thousands of jobs could be effected. This could be the biggest privatization initiative that the Alberta government has ever embarked upon."
Premier Klein has said that the introduction of the Corporate Services Centre could reduce administration costs by up to 20 per cent, but Cormack wonders if that is the government's real motivation. She also says the government's deliberately vague media statements have left the public with more questions than answers.
"Is this really about saving money or are they simply attempting to use outsourcing as a way to get rid of pesky public sector unions?" asked Cormack. "How many jobs are going be affected? And where did the idea for these changes come from? This kind of initiative was never mentioned at the Growth Summit - and it's not something that Albertans have been lobbying for. The public deserve answers for these kind of questions."
Cormack scoffed at reassurances from Premier Klein that most of the affected employees would find new employment with private sector contractors.
"This is the Alberta government's favourite dirty trick," says Cormack. "First they privatize a service and then they hire all the original employees back to work for the private contractor. The workers are sitting in the same desk and doing the same job - but they are paid less and they loose their pensions and benefits. This is a shameful way to save money and it's a shameful way to treat employees - especially at a time when the government is recording huge surpluses."
Cormack says that Albertans should be concerned about any plan that involves funneling huge amounts of tax-payer dollars to for-profit corporations who are, by their very nature, unaccountable to the public.
"Ralph Klein and members of his government have spent a lot of time saying that they're no longer in the business of business. With this plan, it sounds like they're trying to get out of the business of government as well. They seem willing to hand the keys of government over to their unelected cronies in the private sector. It's a frightening prospect - and I think it's time for Albertans to say 'enough is enough'."
For more information call:
Audrey Cormack, President @ 483-3021 (wk) /499-6530 (cell) / 428-9367 (hm)