TORONTO -- Health-care advocates are warning that a minor increase in health spending in Ontario will lead to nursing job cuts, hospital closures and poorer drug coverage.

The Liberal government's total health-care budget for 2015-16 will be $50.8 billion, which represents an increase of 1.2 per cent.

The hike, which doesn't keep pace with inflation, means there will be cuts, said Natalie Mehra of the Ontario Health Coalition. Base operating funding for hospitals was frozen for the fourth year in a row.

"Every year the cuts just bite deeper and deeper," she said. "At this point we're threatened with maternity ward closures in different parts of the province, whole wards being closed...and even whole hospitals being closed down."

Finance Minister Charles Sousa said the health-care budget focuses on "transformation" to community care.

"We've got to find ways to provide better quality for value for money and that means providing for more nurse practitioners, more (personal support workers), more services at home for example, enabling pharmacies to do more of that work," he said Friday, the day after presenting his $131.9-billion budget.

"All of that means providing more services to the patient, not taking it away."

There is an average five-per-cent increase in the area of home-care funding in the budget, though Mehra said that has not kept pace with the off-loading of patients from hospitals.

Doris Grinspun of the Registered Nurses' Association of Ontario believes the minimal funding will give hospitals an excuse to fire registered nurses.

"If they are forced to go into restraints, be even wiser about where you do cuts," Grinspun said. "Doing RN replacement is foolish."

Already registered nurses are being replaced by less qualified health-care workers, Grinspun said. In the last few months alone more than 300 nursing positions have been lost across the province, she said.

A hospital in Leamington is considering closing its birthing unit, which could cause expectant mothers to travel up to an hour to Windsor, a Niagara-on-the-Lake hospital this month stopped providing in-patient care and a hospital site in Penetanguishene is closing, Mehra said.

NDP health critic France Gelinas is worried by a $200-million cut to the Ontario Drug Benefit.

The government said the savings will be found through "optimizing" the quantities of medication dispensed, "adjusting" dispensing payments and practices and "modernizing" the coverage and reimbursement of certain products.

"In the budget they say, 'Changing coverage and reimbursement of certain products,' so in lingo that means drugs that used to be covered won't be covered anymore," Gelinas said.

The budget also cites "evidence-based updates to pricing" as generating savings of $20 million in an assistive devices program, which Gelinas is concerned will mean people on disability support will have a harder time paying for devices such as electric wheelchairs and hearing aids.

The Progressive Conservatives often say the Liberals have a "spending addiction," but MPP Lisa MacLeod said health care is not where spending should be restrained.

"We've always said that you need to maintain or increase the budgets in health care and education," she said. "Those are the priorities. Those are why people send taxes to Queen's Park and they're public services that we value."