Canada's premiers and territorial leaders are calling for a new health care funding formula with Ottawa in order to satisfy "the number one priority of Canadians."

Nova Scotia Premier John Hamm says provinces have been increasing health care spending at a faster pace than revenue growth, a situation he called "not sustainable."

"We need a new funding partnership with the federal government," said Hamm, the host and spokesman for the 43rd gathering of premiers.

Hamm said the provinces have combined to increase health care spending by $4.25 billion a year over the last five years. He said the provinces are frustrated by Ottawa's refusal to pump more money into the health care system while it operates with a large budget surplus.

"When the program started 30 years ago, it was a 50-50 program. Now federal funding of health care is less than 15 per cent. That is the real problem," says New Brunswick Premier Bernard Lord.

Speaking from Vancouver, the prime minister said they just gave the provinces money two years ago.

"They always ask for more money," he Jean Chretien said. "We gave them two years ago $23 million over a period of five years and again they want more."

However, Chretien has agreed to a first ministers' meeting on health care before Ottawa's next federal budget. He said he'll get together with the premiers after Roy Romanow releases his national report on health care this fall.

"These are dollars they (Ottawa) take out of Canadians' pockets," said B.C. Premier Gordon Campbell. "Canadians know that federal dollars are not being invested the way they should be.

"I believe the prime minister will respond to Canadians."

That belief could have something to do with the fact that Chretien is facing a leadership review, and polls show the number one issue among Canadians is health care.

"There's one thing that I know the federal Liberal government understands it's polling, especially as you get closer and closer to either a leadership contest or an election and I think we'll get their attention," says Ontario Premier Ernie Eves.

The premiers also said they're developing a national nursing strategy and are working towards a common system for home and community care.

Kyoto climate treaty

While the premiers appear united on health care, the debate of what to do about the controversial Kyoto Accord rages with Quebec and Alberta squaring off.

That will be the main topic under debate on Friday, when premiers talk about ways to end global warming. But things could get very heated, especially between Alberta's Ralph Klein and Quebec's Bernard Landry.

On Wednesday at the opening of the annual conference, Landry said the protection of the environment must not be compromised by the interests of one province, namely Alberta which staunchly opposes Kyoto.

"I'm not here to fight with Mr. Landry," Klein said. "I'm in here to seek a common-sense approach to a made-in-Canada solution to address the issue of climate change."

Klein alleged Quebec is doing more damage to the environment through its massive hydroelectric projects than harm done by the Alberta oil industry.

"If he (Landry) is convinced Kyoto should be ratified, then there should be a full and absolute assessment of the impact of creating 21,000 megawatts of power using water," Klein said.

Landry called climate change an international problem related to the future of mankind, "so we must not link that to self-serving interests."

In an interview with CTV's Canada AM on Thursday, Manitoba Premier Gary Doer denied claims his province favours Kyoto because Manitoba would benefit the most by exporting its abundant electricity and claiming the environmental credits associated with it.

Under Kyoto, countries are awarded credits or points for using clean energy in place of dirtier sources, such as coal.

"We're not proposing that any one province . . . would be on their own for purposes of credits. We think that we should take a pan-Canadian view," Doer said.

"The credits should be spread across the country, not just in one province."

Hamm and Newfoundland Premier Roger Grimes both held out on agreeing to a first ministers' meeting on the accord, saying they would rather discuss the issue over the next two days.

The Kyoto accord calls for Canada to commit to reducing greenhouse gas emissions to six per cent below 1990 levels by 2010. The federal government is looking at four options to meet that target.

Doer acknowledges that achieving a consensus on Kyoto could prove elusive.

"I think we're going to agree to disagree. That's the reality of it," Doer said.