50-50 Funding Deal Agreed for Public Sector Health Plan

According to a deal finalized and publicized on Wednesday, the Federal public servants will be phased towards a 50-50 cost-sharing arrangement for the Public Service Health Care Plan. Treasury Board President, Tony Clement, who although previously threatened in February to implement the arrangement through legislation if unions failed to sign on, alleged that the deal was negotiated in good faith with public sector unions.

Speaking with reporters while making the announcement, Mr. Clement stated that “quite frankly, we both put some water in our wine and that’s the nature of negotiated settlements but this is definitely a win for taxpayers to the tune of $6.7-billion over the next six years.” Mr. Clement announced on Wednesday that the savings will be approximately $700-million less over six years than the $7.4-billion listed in the 2014 budget. He straightforwardly highlighted that the direct impact for members of the plan will be an increase in monthly fees from $24 to $48, adding that the low-income members will be exempted from this change.

The largest union of federal public servants, The Public Service Alliance of Canada, mentioned in a statement that it secured some changes through negotiations. In the statement, the union mentioned that “while we are against these changes, it was clear from our discussions with Treasury Board that if we didn’t come to an agreement, these changes would be legislated,” adding that “in this context, we got a deal which has a number of substantial improvements to the plan.”

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