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Most Canadian provinces have introduced legislation to require politicians of all ideological stripes to meet annual balanced budget (BB) targets. Critics of this type of legislation argue that it is unnecessary, confining, and subject to manipulation. We examine provincial balanced budget legislation before and after the Great Recession and argue that the response of provinces needs to be evaluated taking into account the multiple objectives of fiscal policy and the behavioural changes that the rules introduce, including creative non-compliance. Rules should be evaluated on their ability to contribute to good fiscal governance rather than on their stringency. [ABSTRACT FROM AUTHOR]

We analyze the expected impact of the new Canada Health Transfer (CHT) on the capacity of Canadian provinces to provide universal Medicare coverage. We found the new CHT formula, recently redesigned by the federal government, fails to address the differing capacity of provinces to provide Medicare coverage due to the unavoidably higher costs imposed by the population's age structure and geographical dispersion. We propose a modified capitation formula that adjusts for these 'unavoidable' cost factors. The redistributive impact on the provinces is examined as well as the extent to which the proposed CHT fits with other federal transfer, especially Equalization. [ABSTRACT FROM AUTHOR]