Silas: Canada needs public health care investment, not austerity
April 28, 2026 (Ottawa, ON) – A one percent increase in public health care spending would raise real GDP in Canada by billions of dollars in the first year alone, according to a new study commissioned by the Canadian Federation of Nurses Unions (CFNU). Drawing on economic modelling conducted by Quantitative Economic Decisions, Inc., this study quantifies the economic impacts of increased public sector health spending in Canada.
Released today, The economic impact of increased public sector health spending in Canada was authored by Robin Somerville, economist and president of Quantitative Economic Decisions, Inc. The report outlines the benefits of an increase in federal health expenditures, with calculations for both a deficit-financed and tax-financed scenario.
“Public health care offers such a strong return on investment that even a modest increase to federal spending should be a no-brainer. Health care is one of Canada’s largest and most dynamic industries, and it is largely insulated from the trade disruptions that are threatening Canada’s economy. This is not the time for austerity, it’s the time for sound investment in this critical nation-building effort,” said CFNU President Linda Silas.
For every dollar the federal government spends on health, after one year between $1.32 and $1.45 is generated of additional GDP, depending on whether the spending is deficit-financed or tax-financed. Analysis indicates that these results would rise proportionally with higher levels of health spending.
Over the first 5 years of the 1% increase in health spending, between $15.5 and $19.5 billion in real GDP and 69,000 to 83,000 years of work are added to the Canadian economy, with the lower numbers associated with the tax-financed scenario and the higher ones with the deficit-financed scenario.
In its pre-budget submission for the federal government’s 2026 budget, the CFNU is urging the government to maintain the Canada Health Transfer escalator at a minimum of 5% annually and move toward restoring a 6% escalator to reflect actual health system costs and demographic pressures.
“Whichever way you cut it, an increase to public health care spending comes with positive outcomes for Canada,” Silas said. “We know that an increase to health care spending would not only strengthen access to care and overall health, but Canada’s economy would also grow stronger and more resilient. All we need now is action from the federal government.”
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The CFNU is Canada’s largest nurses’ organization, representing 250,000 frontline unionized nurses and nursing students in every sector of health care – from home care and LTC to community and acute care – and advocating on key priorities to strengthen public health care across the country.
For more information, please contact Adella Khan, media@nursesunions.ca, 613‑807‑2942.