Provincial Budget Aims to Tackle Deficit

Barrie Deputy Mayor Thinks Province Is Out of Touch With Municipal Priorities

The Ford Government has handed down its first budget, and it is said to be designed to hew an inherited deficit.

Finance boss Vic Fedeli presented the budget at Queen’s Park this afternoon, highlighting some spending on a few programs and services, with cuts to other areas.

“Nobody should underestimate the mess we inherited.”

Ontario Finance Minister Vic Fedeli

Fedeli says the PC government inherited a significant deficit, at $14 billion by the Ford government’s estimation, claiming cuts in this budget have lowered it to a projected $11.7 billion. The overall budget has a bottom line of $163.4 billion.

The PC Government’s first budget also allows for booze to be sold as of 9:00 in the morning across the province, and gives municipalities the power to allow for public drinking. Some establishments will be permitted to advertise a happy hour, while the provincial budget also pushes for the purchase of lottery tickets on cellphones. All tax increases planned by the previous Wynne government on beer and wine have been cancelled.

Fedeli indicated in his budget speech that changes are coming to Ontario’s auto insurance industry. “It is clear the Ontario’s auto insurance system is broken,” Fedeli said at Queen’s Park, “and drivers deserve transformative change.” Ontario’s no-fault insurance system, fraught with costly fraudulent claims, is among the most expensive in the country.

“…the provincial government seems a bit out of touch about what municipalities are actually asking for.”

Barry Ward, Deputy Mayor of the City of Barrie

Barrie Deputy Mayor Barry Ward worries the Provincial Government isn’t listening. “I kind of worry the provincial government seems a bit out of touch about what municipalities are actually asking for. I mean, if you ask any Barrie councillor, I think they would list many priorities we have, and they’d list things like affordable housing, infrastructure, transit. Those are priorities; I think you’d have to talk to them for quite a while before they talk about rules governing alcohol.”

In response, MPP Andrea Khanjin says the budget does address affordable housing “Part of the budget is a housing supply strategy. We all know that if there’s not enough housing supply, then house prices are going to rise and that affects all types of housing.” says Khanjin. “We’ve been clear on that, we said that we’re going to table an affordable housing strategy; that’s in the works, that is mentioned in the budget. In fact, what’s also mentioned in the budget is the amount we’re investing in helping municipalities with affordable housing.” Her counterpart, MPP Doug Downey says there’s a $200 million fund dedicated to helping municipalities in finding efficiencies.

Over a billion dollars has been cut from Children’s and Social Services in this budget, while there is a slight increase in spending to healthcare and education programs. The new PC Government’s budget includes an annual education spending increase of 1.2% over 3 years. In comparison, the former Liberal government increased education spending by 5.6% per year over the last 2 years. The government’s budget plans to curb overtime spending to police, nurses, and other health-care workers, through scheduling and attendance-management improvements. Those hoping for legal aid services will face extra challenges as the province moves to change qualifications as of 2021. Colleges and universities could lose up 60 per cent of their operating budgets if they fail to meet new performance targets, while lower income post-secondary students will no longer be eligible for free tuition.

The budget also contains provisions for a new Ontario Childcare Access and Relief from Expenses (CARE) tax credit to help combat rising costs of child care in Ontario.

Deputy Mayor Ward adds the lack of specifics in some budget items indicates there could be plans to offload some costs to the municipal level. “We’ve already had to think about it in Barrie, where they’ve downloaded more of the court security costs to the taxpayers in Barrie, and there’s a worry they’re going for things like welfare, ODSP, things like that.”

Net debt is expected to reach $382 billion by 2021, according to Fedeli’s math, before slowly declining. The provincial Tories don’t expect to eliminate the red until the year 2024.