Ontario gov't expenses to rise by almost $5 billion this year
Minister of Finance Charles Sousa. (Toronto Sun files)
The Ontario government is planning to spend its way out of the economic doldrums.
Government expenses including debt repayment fees will rise by almost $5 billion this year, reversing course on a restraint trend that saw total spending actually drop in 2012-13 compared to the previous year.
Premier Kathleen Wynne said she is focused on controlling expenses but will not usher in an austerity budget that dramatically reduces spending.
“Cutting programs, slashing across the board, is not going to get us to an aspirational future,” Wynne said Thursday.
Ontario released its 2013 Economic Outlook which the government touted as a plan to spur growth, create jobs and strengthen public service.
As part of its fall statement, the Wynne government is announcing a three-part plan to invest in people, modern infrastructure and an innovative business climate.
“And with growth, we will have the revenue to balance our budget,” the statement says.
But the document says that should the global economy falter, impacting provincial revenues, the government will protect its investments in jobs and families rather than short-term targets, suggesting spending on public services could trump deficit reduction.
The economic outlook pegs the deficit this year at more than $11.7 billion, up from $9.2 billion last year, and the annual cost of debt repayment at just over $10.6 billion.
Finance Minister Charles Sousa said the government is still on track to balance the budget in 2017-18 but not at any cost.
“Achieving a zero deficit is not a victory if you have zero growth and zero jobs,” Sousa said.
Progressive Conservative Leader Tim Hudak said he did not see a credible job creation plan in the economic outlook.
“You can’t spend your way out of deficit and you can’t tax your way to prosperity,” Hudak said. “If that worked, we would have been there by now.”
New Democrat Leader Andrea Horwath said she was disappointed that the document promised more study and panels, rather than action on pressing public concerns.
“People were hoping the government would start tackling waste and balancing the books by closing corporate tax loopholes and capping (public sector) CEO salaries,” she said.
Of the 26 government ministries, 18 will see their budgets increased with health care up almost $1.3 billion and education increasing by more than $1.1 billion.
Facing shrinking bottom lines are Aboriginal Affairs, Citizenship and Immigration, Economic Development, Energy, Government Services, Municipal Affairs and Housing, and Tourism, Culture and Sport.
Francophone Affairs will remain frozen at $5 million as it has for several years.
Sousa said the government will create a new Trillium Trust, using the sale of public assets such as Ontario Lottery and Gaming Corp. and LCBO properties and the issuing of Green Bonds, to help finance transit and other environmentally friendly projects.