Grants to the Government of the Northwest Territories and the Government of Nunavut for Health Care of Indians and Inuit

On this page

1. Introduction
2. Legal and policy authority
3. Purpose, program objectives and expected results
4. Eligibility
5. Type and nature of eligible expenditures
6. Total Canadian government funding and stacking limits
7. Method for determining the amount of funding
8. Maximum amount payable
9. Basis on which payments will be made
10. Application requirements and assessment criteria
11. Due diligence and reporting
12. Official languages
13. Intellectual property
14. Other terms and conditions
15. Effective date of terms and conditions

1. Introduction

Since the early 1950s the Government of Canada has been involved with ensuring the delivery of health care programs in the territories. The original intent was for the federal government and the territories to share equally (50%) in assuming health care costs pursuant to the Acts; however, territorial governments could not meet their commitments because of large aboriginal populations. In 1959 Canada made provision for annual grants to the Northwest Territories for hospital and health services, administered by the Department of Northern Affairs and Natural Resources. A June 25, 1959, Cabinet decision stipulated:

… that approval in principle be given for the payment to the Northwest Territories of a special annual grant (in addition to amounts payable pursuant to the Hospital Insurance and Diagnostic Services Act) so calculated that the federal Government will continue to bear the total cost of hospital care for Indians and Eskimos, having due regard for indigency, and that the amount of such grants be provided annually in the estimates of the Department of Northern Affairs and Natural Resources.

In 1966 the program was transferred to the newly created Department of Indian Affairs and Northern Development. In 1970 the grant terms and conditions were expanded to include physician services. In 1977 changes to the Canadian Financial Administration Act, led to the conversion of the 'special grant' arrangements into Contribution Agreements. In 2004, Treasury Board approved the use of a grant authority in place of a contribution authority. This change to grants respects the intent of the funding originally approved by Cabinet in 1959.

These terms and conditions are specifically targeted to other orders of government.

In 2020, a global COVID-19 pandemic, has resulted in the requirement for emergency funding to the governments of the Northwest Territories, Nunavut and Yukon. This emergency funding is needed to respond to the pandemic through preparedness, mitigation and response measures in the health sector and air transportation, as defined by each Territorial government.

2. Legal and policy authority

• Northwest Territories Act (Canada), Section 16 (q) 1985
• Department of Crown-Indigenous Relations and Northern Affairs Act, 2019
• Nunavut Act (Canada), Section 23(1) (h), 1993
• Public Health Events of National Concern Payments Act, S.C. 2020, c. 5, s. 9
• Yukon Act, S.C. 2002, c.7

3. Purpose, program objectives and expected results

The purpose of the grant is to support the Government of the Northwest Territories and the Government of Nunavut in providing Hospital Services and Physician Services for Indigenous people. The grant allows the territorial governments to deliver health services to their residents as stipulated in the Northwest Territories Act (Canada), 1985 and the Nunavut Act, 1993. These terms and conditions may also be used for the purpose of the response to the 2020 COVID-19 pandemic. In this case the governments of the Northwest Territories, Nunavut and Yukon are eligible funding recipients.

The activities funded through this grant contribute to Crown-Indigenous Relations and Northern Affairs Canada's (CIRNAC) core responsibility for Northern Affairs, and supports Departmental Result: Arctic and Northern Leadership and Prosperity are Advanced.

In the specific case of the 2020 COVID-19 pandemic, the funds for the governments of the Northwest Territories, Nunavut and Yukon are intended to help territories address the critical priorities they identified to minimize the spread of the virus. Specifically, the purpose of this grant is to enable the governments of the Northwest Territories, Nunavut and Yukon to respond to public health emergencies and related services for territorial residents and populations.

This grant will enable the governments of the Northwest Territories, Nunavut and Yukon to support a focused and reliable air network for the movement of essential goods and services.

It is expected that measures under this grant, where they relate to the 2020 COVID-19 pandemic, will be time-limited: until Public Health Events of National Concern Payments Act is repealed. CIRNAC will determine the approach to monitor and assess the Department's performance related to the current public health event in future public reporting. Additional information will be integrated into the relevant Performance Information Profile.

4. Eligibility

The Government of the Northwest Territories and the Government of Nunavut are the sole recipients. For the purposes of the 2020 COVID-19 pandemic, the Government of Yukon is also an eligible recipient.

5. Type and nature of eligible expenditures

Eligible expenditures include the following:

Hospital facilities: The hospital facilities within the territories are named in each agreement; and, outside the territory can include any facility or portion thereof that provides hospital services, including acute, rehabilitative or chronic care, but does not include: a) a hospital or institution primarily for the mentally disordered; or b) a facility or portion thereof that provides nursing home intermediate care service or adult residential care service or comparable services for children.

Hospital services: Hospital services means any of the following services provided to in-patients at a hospital, if the services are medically necessary for the purpose of maintaining health, preventing disease or diagnosing or treating an injury, illness or disability, namely: accommodation and meals at the standard or public ward level and preferred accommodation if medically required; nursing service; laboratory, radiological and other diagnostic procedures, together with the necessary interpretations; drugs, biological and related preparations when administered in the hospital; use of operating room, case room and anesthetics facilities, including necessary equipment and supplies; medical and surgical equipment and supplies; use of radiotherapy facilities; use of physiotherapy facilities; and, services provided by persons who receive remuneration therefor from the hospital. It does not include services that are excluded by the regulations to the Canada Health Act, R.S.C. 1985. c. C-6.

Physicians services: Physicians services include any medically required services rendered by medical practitioners to Indigenous people of the Northwest Territories and Nunavut in a manner consistent with the terms and conditions of the Canada Health Act, R.S.C. 1985. c. C-6 and the Medical Care Act, R.S.C., R.S.N.W.T., 1988, c. M-8.

Medical practitioner: Medical practitioner is a person lawfully entitled to practice medicine in the place in which the practice is carried on by that person.

2020 COVID-19 pandemic: For the purposes of this grant, eligible expenditures are those related to the preparedness, mitigation and response towards health, social services and supply chain management. General measures may include, but not are limited to:

• accommodation costs related to isolation and quarantine in the case of a pandemic
• costs associated with surge capacity in human resources in the health and social sectors
• acquiring medical and other essential supplies
• costs related to public health, safety and emergency response needs;
• public health-related programs
• costs associated with a focused and reliable air network, as determined by the territories

6. Total Canadian government funding and stacking limits

Stacking limits do not apply as CIRNAC provides 100% of the funding for these activities.

7. Method for determining the amount of funding

With the creation of Nunavut, effective April 1, 1999, CIRNAC's appropriation for hospital and physician services for Indigenous people was divided between the Government of the Northwest Territories and the Government of Nunavut through the Annual Reference Level Update (ARLU), with the former receiving approximately 56% and the latter 44 %.

2020 COVID-19 pandemic: The primary method for determining the amount of funding with respect to direct requirements of the 2020 COVID-19 pandemic, is ongoing collaboration between the federal government and the governments of the Northwest Territories, Nunavut and Yukon. Other methods used in determining the amount of funding include: formula based financing, direct costing of services, materials and equipment; and are all subject to budgetary considerations and allocation of funds by Parliament.

In the context of funding announced on April 14, 2020, funding amounts for health and social services preparations and response and continuity of essential air transportation services were determined using:

• formula-based per-capita allocation, grounded in actual and anticipated health and social system costs in a territorial context
• actual and anticipated costs related to quarantine and isolation requirements
• identification of key routes to enable a focused and reliable air network for the movement of essential goods and services and the level and type of support required to maintain the key routes, including financial support and regulatory relief, as determined by the territories

Further support for the governments of the Northwest Territories, Nunavut and Yukon could be provided under this authority, based on discussions between the federal government and the governments of the Northwest Territories, Nunavut and Yukon, and budgetary considerations and allocation of funds by Parliament.

8. Maximum amounts payable

Under the Hospital and Physician Services Grant program, the maximum amount payable to the two territorial governments is calculated as the $42.867 million base as of April 1, 2004. Annual increases, over the duration of the terms and conditions of the grant, are consistent with those in the Indian and Inuit Envelope currently set at 2% annually or after adjustments that the federal government may provide to CIRNAC in relation to health expenditures for Aboriginal people in the Northwest Territories and Nunavut.

In the specific case of the 2020 COVID-19 pandemic, the evolving nature of the pandemic prohibits identifying the total cost to support the governments of Northwest Territories, Nunavut and Yukon's health, social services and supply chain management preparedness, mitigation and response measures up front.

In the context of funding announced on April 14, 2020, the maximum amounts payable to each government under this initiative are as follows:

• $18.4 million for Yukon for health and social services preparations and response and $3.6 million for air services
• $23.4 million for the Northwest Territories for health and social services preparations and response and $8.7 million for air services
• $30.8 million for Nunavut for health and social services preparations and response and up to $5 million for air services

Further support for the governments of Northwest Territories, Nunavut and Yukon could be provided under this authority, based on discussions between the federal government and the governments of Northwest Territories, Nunavut and Yukon, and budgetary considerations and allocation of funds by Parliament.

9. Basis on which payments will be made

The annual maximum limit will be attained through 12 monthly payments from CIRNAC. Actual payment will be made at the end of each month.

The payment schedule is a follows: The territories will receive two twelfths of the funds at the end of April; and one eleventh of the amount at the end of each month, May to March.

CIRNAC will enter into a 5-year Grant Agreement with each of the Government of the Northwest Territories and the Government of Nunavut. The Grant Agreement will contain the following terms and conditions:

1. Program objectives
2. Eligible expenditures
3. Basis and timing of payments
4. Accountability requirement (CIRNAC will require each government to report the actual expenditures for hospital and physician services for Indigenous people in their Public Accounts. The Public Accounts are reviewed annually by the Office of the Auditor General)

In response to the 2020 COVID-19 pandemic, federal support to the governments of Northwest Territories, Nunavut and Yukon will be transferred to their respective Territorial General Revenues and the governments of Northwest Territories, Nunavut and Yukon will enter into a Grant Agreement. The Grant Agreement will contain the following Terms and Conditions:

1. Program objectives
2. Eligible expenditures
3. Basis and timing of payments — the payment schedule will be discussed with the governments of Northwest Territories, Nunavut and Yukon and defined in the Grant Agreement.
4. Accountability requirement — the accountability mechanism of taking into account and, to the greatest extent possible, rely on the accountability regimes of the governments of Northwest Territories, Nunavut and Yukon, including audit, evaluation, and direct reporting to citizens.

10. Application requirements and assessment criteria

No special application is required. CIRNAC deems the Government of the Northwest Territories and the Government of Nunavut to have applied for this grant through the administrative arrangements that evolved from the 1959 Cabinet decisions for a "special annual grant" and subsequent operations. The 1999–2000 ARLU approved authority for the calculations for the Government of the Northwest Territories and the Government of Nunavut to reflect the creation of Nunavut, with approximately 56% of the maximum level going to the Government of the Northwest Territories and 44% to the Government of Nunavut.

The Grant Agreements will contain the Government of the Northwest Territories' and the Government of Nunavut's Expenditure Plans and the cash flow arrangements from CIRNAC. The cash flow accounts for expenditure needs as demonstrated by the recipients. CIRNAC reviews the Expenditure Plans and if it is accepted, CIRNAC subsequently establishes the monthly payment schedule.

In the specific case of the 2020 COVID-19 pandemic, the governments of the Northwest Territories, Nunavut and Yukon do not need to apply for the funding. CIRNAC deems the governments of Northwest Territories, Nunavut and Yukon to have applied for this grant through intergovernmental discussions resulting in the April 14, 2020 federal funding announcement.

Further support for the governments of Northwest Territories, Nunavut and Yukon could be provided under this authority, based on discussions between the federal government and the governments of Northwest Territories, Nunavut and Yukon, and budgetary considerations and allocation of funds by Parliament.

11. Due diligence and reporting

No specific reporting requirements related to delivery of Hospital Services and Physician Services by the governments of the Northwest Territories and Nunavut are necessary for this grant, per the Northwest Territories Act (Canada), 1985 and the Nunavut Act, 1993.

In the specific case of the 2020 COVID-19 pandemic, no specific reporting requirements by the governments of the Northwest Territories, Nunavut and Yukon are necessary for this grant. The governments of the Northwest Territories, Nunavut and Yukon's continued response to the pandemic is sufficient to justify their receipt of continued funding.

Monitoring and reporting will rely on the accountability regimes of the governments of the Yukon, Northwest Territories and Nunavut including audit, evaluation and direct reporting to citizens. This will be used to assist in demonstrating the Government of Canada's accountability for expenditures related to 2020 COVID-19.

With respect to funding for air services related to the 2020 COVID-19 pandemic, specific reporting requirements will be set out in the Grant Agreements, as described below:

1. Confirmation that air operators have applied for the Canada Emergency Wage Subsidy.
2. Confirmation that Canada Emergency Wage Subsidy amounts have been taken into account when estimating the minimum funding levels required to enable a focused and reliable air network.
3. Requirement to identify (and update as necessary) key routes to enable a focused and reliable air network for the movement of essential goods and services and the level and type of support required to maintain the key routes, including financial support and regulatory relief.
4. Requirement to notify the federal government of any potential funding shortfall by the air operators and territorial governments, and to return any federal funds not disbursed to air operators to the federal government.

12. Official languages

Where a program supports activities that may be delivered to members of either official language community, access to services from the recipient will be provided in both official languages where there is significant demand and Part IV of the Official Languages Act is applicable. In addition, the department will ensure that the design and the delivery of programs respect the obligations of the Government of Canada as set out in Part VII of the Official Languages Act.

13. Intellectual property

Where a grant is provided for the development of material in which copyright subsists, conditions for shared rights between the recipient and the Crown will be set out in the funding agreement.

14. Other terms and conditions

None

15. Effective date of terms and conditions

These terms and conditions are in effect as of May 8, 2020.