Healthcare Innovation Isn’t ‘Scary.’ Canada’s Broken System Is

From the Frontier Centre for Public Policy

“Our healthcare system is a monopoly installed at every level with the culture inherent to monopolies, whether public or private. The culture is based on regulation and budgetary controls, closed to the outside world, impermeable to real change, adaptation and innovation. It is a culture that favours inefficiency.”

Why is the Globe and Mail afraid of healthcare reform that works?

The Globe and Mail editorial board seems to find healthcare innovation “scary.”

On Sept. 3, it published an editorial called “Danielle Smith has a scary fix for healthcare,” criticizing the Alberta Premier’s idea to introduce competition in the province’s health system. Premier Smith’s plan involves third-party leasing of underperforming hospitals while the government retains ownership and continues funding.

Let’s be clear: the real problem isn’t Smith’s proposal – it’s the current state of healthcare across Alberta and Canada. Sticking with the status quo of underperformance is what should truly alarm us. Rather than attacking those trying to fix a broken system, we should focus on much-needed reforms.

So, what exactly is Smith proposing? Contrary to what you may have heard, she isn’t dismantling Alberta’s universal healthcare or introducing an American style system. Yet the public sector unions – and certain media outlets – seem to jump into hysterics any time innovation is proposed, particularly when it involves private-sector competition.

Predictably, groups like Friends of Medicare, with their union ties, are quick to raise the alarm. Yet media coverage often fails to disclose this affiliation, leaving readers with the impression that their views are impartial. Take Global News’ recent coverage, for example:

In late August, Global News reporter Jasmine King presented a story on potential changes to Alberta’s healthcare system. She featured a spokesperson from Friends of Medicare, who predicted that the changes would be detrimental to the province. However, the report failed to mention that Friends of Medicare is affiliated with public sector unions and has a history of opposing any private sector involvement in healthcare. The news segment also included a statement from the dean of a medical faculty, who was critical of the proposed changes. Missing from the report were any voices in favour of healthcare innovation.

Here’s the real issue: Canada is an outlier in its resistance to competition in healthcare. Many European countries, which also have universal healthcare systems, allow private and non-profit organizations to operate hospitals. These systems function effectively without the kind of fear-mongering that dominates the Canadian debate.

Instead of fear-based comparisons to the U.S., let’s acknowledge the success stories of countries that have embraced a mixed system of healthcare delivery. But lazy, fear-driven reporting means we keep hearing the same tired arguments against change, with little context or consideration of alternatives that are working elsewhere.

It’s ironic that The Globe and Mail editorial aims to generate fear about a health care policy proposal that could, contrary to the alarmist reaction, potentially improve efficiency and care in Alberta. The only thing we truly have to fear in healthcare is the stagnation and inefficiency of the current system.

Claude Castonguay, the architect of Quebec’s Medicare system, released a report in 2008 on that province’s health system, calling for increased competition and choice in healthcare.

“In almost every other public and private areas, monopolies are simply not accepted,” he wrote. “Our healthcare system is a monopoly installed at every level with the culture inherent to monopolies, whether public or private. The culture is based on regulation and budgetary controls, closed to the outside world, impermeable to real change, adaptation and innovation. It is a culture that favours inefficiency.”

The fear of competition is misguided, and Canadians are increasingly open to the idea of paying for private treatment when the public system falls short.

Let’s stop demonizing those who propose solutions and start addressing the real issue: a system that is no longer delivering the care Canadians need. The future of healthcare depends on embracing innovation, not clinging to outdated models and misplaced fears.

Joseph Quesnel is a Senior Research Fellow with the Frontier Centre for Public Policy.

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Low oil prices could have big consequences for Alberta’s finances

Published on April 26, 2025

Todayville

From the Fraser Institute

By Tegan Hill

Amid the tariff war, the price of West Texas Intermediate oil—a common benchmark—recently dropped below US$60 per barrel. Given every $1 drop in oil prices is an estimated $750 million hit to provincial revenues, if oil prices remain low for long, there could be big implications for Alberta’s budget.

The Smith government already projects a $5.2 billion budget deficit in 2025/26 with continued deficits over the following two years. This year’s deficit is based on oil prices averaging US$68.00 per barrel. While the budget does include a $4 billion “contingency” for unforeseen events, given the economic and fiscal impact of Trump’s tariffs, it could quickly be eaten up.

Budget deficits come with costs for Albertans, who will already pay a projected $600 each in provincial government debt interest in 2025/26. That’s money that could have gone towards health care and education, or even tax relief.

Unfortunately, this is all part of the resource revenue rollercoaster that’s are all too familiar to Albertans.

Resource revenue (including oil and gas royalties) is inherently volatile. In the last 10 years alone, it has been as high as $25.2 billion in 2022/23 and as low as $2.8 billion in 2015/16. The provincial government typically enjoys budget surpluses—and increases government spending—when oil prices and resource revenue is relatively high, but is thrown into deficits when resource revenues inevitably fall.

Fortunately, the Smith government can mitigate this volatility.

The key is limiting the level of resource revenue included in the budget to a set stable amount. Any resource revenue above that stable amount is automatically saved in a rainy-day fund to be withdrawn to maintain that stable amount in the budget during years of relatively low resource revenue. The logic is simple: save during the good times so you can weather the storm during bad times.

Indeed, if the Smith government had created a rainy-day account in 2023, for example, it could have already built up a sizeable fund to help stabilize the budget when resource revenue declines. While the Smith government has deposited some money in the Heritage Fund in recent years, it has not created a dedicated rainy-day account or introduced a similar mechanism to help stabilize provincial finances.

Limiting the amount of resource revenue in the budget, particularly during times of relatively high resource revenue, also tempers demand for higher spending, which is only fiscally sustainable with permanently high resource revenues. In other words, if the government creates a rainy-day account, spending would become more closely align with stable ongoing levels of revenue.

And it’s not too late. To end the boom-bust cycle and finally help stabilize provincial finances, the Smith government should create a rainy-day account.

Alberta

Governments in Alberta should spur homebuilding amid population explosion

Published on April 26, 2025

Todayville

From the Fraser Institute

By Tegan Hill and Austin Thompson

In 2024, construction started on 47,827 housing units—the most since 48,336 units in 2007 when population growth was less than half of what it was in 2024.

Alberta has long been viewed as an oasis in Canada’s overheated housing market—a refuge for Canadians priced out of high-cost centres such as Vancouver and Toronto. But the oasis is starting to dry up. House prices and rents in the province have spiked by about one-third since the start of the pandemic. According to a recent Maru poll, more than 70 per cent of Calgarians and Edmontonians doubt they will ever be able to afford a home in their city. Which raises the question: how much longer can this go on?

Alberta’s housing affordability problem reflects a simple reality—not enough homes have been built to accommodate the province’s growing population. The result? More Albertans competing for the same homes and rental units, pushing prices higher.

Population growth has always been volatile in Alberta, but the recent surge, fuelled by record levels of immigration, is unprecedented. Alberta has set new population growth records every year since 2022, culminating in the largest-ever increase of 186,704 new residents in 2024—nearly 70 per cent more than the largest pre-pandemic increase in 2013.

Homebuilding has increased, but not enough to keep pace with the rise in population. In 2024, construction started on 47,827 housing units—the most since 48,336 units in 2007 when population growth was less than half of what it was in 2024.

Moreover, from 1972 to 2019, Alberta added 2.1 new residents (on average) for every housing unit started compared to 3.9 new residents for every housing unit started in 2024. Put differently, today nearly twice as many new residents are potentially competing for each new home compared to historical norms.

While Alberta attracts more Canadians from other provinces than any other province, federal immigration and residency policies drive Alberta’s population growth. So while the provincial government has little control over its population growth, provincial and municipal governments can affect the pace of homebuilding.

For example, recent provincial amendments to the city charters in Calgary and Edmonton have helped standardize building codes, which should minimize cost and complexity for builders who operate across different jurisdictions. Municipal zoning reforms in Calgary, Edmonton and Red Deer have made it easier to build higher-density housing, and Lethbridge and Medicine Hat may soon follow suit. These changes should make it easier and faster to build homes, helping Alberta maintain some of the least restrictive building rules and quickest approval timelines in Canada.

There is, however, room for improvement. Policymakers at both the provincial and municipal level should streamline rules for building, reduce regulatory uncertainty and development costs, and shorten timelines for permit approvals. Calgary, for instance, imposes fees on developers to fund a wide array of public infrastructure—including roads, sewers, libraries, even buses—while Edmonton currently only imposes fees to fund the construction of new firehalls.

It’s difficult to say how long Alberta’s housing affordability woes will endure, but the situation is unlikely to improve unless homebuilding increases, spurred by government policies that facilitate more development.