We can’t afford to loose Medicare, warns CEO

Gil McGowan, AFL Staff

Canada’s government-financed health care system gives Canadian businesses a huge advantage over competitors south of the border, says Michael Grimaldi, president of General Motor Canada.

In the case of GM plants, Grimaldi says it costs about $12 less per worker, per hour to produce cars in Canada than in the United States. He attributes half of that difference to the existence of Medicare.

"The public health care system significantly reduces total labour costs for automobile manufacturing firms, compared to the cost of equivalent private insurance services purchased by U.S.-based automakers," said Grimaldi in a joint statement last month with Canadian Autoworkers President Buzz Hargrove.

The statement went on to say that the erosion of publicly funded health care – through measures such as delisting services, imposing user fees and contracting out – will "impose significant costs on automotive employers and undermine the attractiveness of Canada as a site for new automotive investment."

Between employees, retirees and their dependents, GM pays for private health care benefits for about 1.25 million Americans, at a cost of about $4 billion (US) in 2000.

That translates into a cost of more than $900 added to each vehicle produced in the U.S.

In Canada, GM pays only for extended health benefits not covered by Medicare (like vision and dental care).

The result is that per person health insurance costs for Canadian GM workers are only about a third of what they are in the U.S.