In Brief: When the New Brunswick government announced it was spending an additional $154-million on health care, AIMS Executive Vice President Charles Cirtwill suggested governments need to get a handle on how they are spending health care dollars before adding to the pot.

Some political observers think they know how Mike Murphy intends to pay for the provincial health plan he laid out in Fredericton Tuesday.

“They’re going to make some cuts somewhere,” said Geoff Martin, a political scientist at Mount Allison University, in an interview. “There are no doubts in my mind that cuts are coming.”

The government will add $154,031,300 to health spending over four years, Murphy said. The Liberals plan to do this without raising taxes or borrowing money, despite talk of a recession in the air.

“Well, that’s enthusiastic. I don’t know where they’re going to find all that money,” said Charles Cirtwill in Halifax, executive vice-president of the Atlantic Institute of Market Studies.

Other than taxes or borrowing, the choices come down to devoting a huge portion of increased tax revenue resulting from any economic expansion over the next four years to the new health program – or going to Ottawa with cap in hand.

The federal government will provide about $19 million of the $154 million, Murphy said in Question Period.

Ottawa should share the cost of the new health program, said Anthony Knight, general manager of the Fredericton Chamber of Commerce, in an interview Tuesday.

However, with the Ontario economy going through a rough patch, New Brunswick should not count on “a big bump” in equalization payments, Cirtwill said.

That leaves savings from elsewhere in the government’s spending program.

They’ve got no choice but to find some efficiency somewhere,” said Progressive Conservative Opposition Leader Jeannot Volpé in an interview early Tuesday evening.

“(Murphy) said he will find it in the budget.”

“I’m just waiting to see what cuts he is going to make to deliver on his commitments,” he said.

The government plans to spend $40 million on the health plan this year, said Murphy, but Volpé argues the government will have to find closer to $100 million.

He cited the government’s numbers to say that the Health Department’s budget increased by eight per cent a year for the past five years – but only 5.4 per cent this year.

This difference of 2.6 percentage points amounts to $60 million, he said, on top of the $40-million installment on the new provincial health plan this year.

Nobody should trust a four-year projection on something as variable as health spending, said Volpé, drawing on his own experience as finance minister. “You can’t rely on these numbers.”

“If we’ve got more service here, we will have to cut somewhere else – or we will have a deficit,” he said.

The provincial balanced budget legislation on top of the political commitment to not increase taxes constrains what the government can do, said Knight at the Fredericton Chamber of Commerce.

“That means they need to find these initial resources in other parts of the provincial budget,” he said.

“The other shoe to drop, I think, will be cuts,” Martin said.

Health care spending grew by eight per cent a year for the past five years while revenue grew by only five per cent a year, states the health plan document, available on the provincial government’s website.

Spending money at that rate on health care takes resources from other priorities such as education, economic development and the environment which, ironically enough, can impact health outcomes, the document states.