Rather than balancing the budget, Ontario plans to have an $8 billion deficit in the coming year
The surprise victory of Doug Ford winning the leadership of Ontario’s Progressive Conservative party over the weekend had the unfortunate effect of distracting voters from another one of last week’s big announcements.
The Wynne government signaled that it would be unveiling a spending spree on social programs in its March 28th budget. And the question Ontarians need to worry about is whether that splurge is even fiscally sustainable. The way things look now, it most certainly isn’t.
Ontario Finance Minister Charles Sousa announced last Wednesday that his government has decided to backtrack on its promise to balance its budgets, with plans for an irresponsible $8 billion deficit in the coming year.
This was the same week that the acting financial accountability officer warned that the province is heading into a financial crisis in the coming three decades. Ontario’s aging society will increase demands for public health care and long-term care support while taxes paid by a slow-growing working population won’t keep pace with the needs of the burgeoning retired population.
It isn’t just the Liberals who have yet to grasp the gravity of Ontario’s problems. Expect all three parties to make promises that are in complete denial of the grim reality. Ontario not only faces serious fiscal problems, its growth is also stagnant, and will likely get worse now that the province is faced with a more competitive and protectionist U.S. economy. Consider these hard truths: