It’s an unfortunate consensus: the three major party leaders are promising to run record-high deficits.
But no matter what Ontario’s politicians might argue, it doesn’t have to be this way.
Just a few weeks ago, Ontario’s Financial Accountability Office (FAO), an independent government agency, declared that the province’s books would be balanced by 2023 had the Ford government simply held the line on spending.
Ford could have presented the province’s first balanced budget in almost 20 years.
Instead, he chose to ramp up his party with taxpayers’ money and abandon the fiscally responsible path made available to him.
When Finance Minister Peter Bethlenfalvy tabled the government’s election budget in late April, it included a $19.9 billion deficit, the largest in the province’s history.
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Yes, higher than the government ran in the thick of the pandemic.
With Ontario’s unemployment rate nearing historic lows and inflated government revenues, the Ford government’s approach to fiscal management is inexcusable. Government revenue has increased by over $15 billion since the start of the pandemic. Still, somehow, Ford managed to blow through that cash windfall and then some.
This isn’t all going to highways and hospitals. Much of the government’s spending is dubious. For example, Ford gave $300 million to Stellantis for factory upgrades, despite the company having revenue exceeding $168 billion in 2021.
There was also no major tax relief in sight.
With inflation at a 30-year high and living costs soaring, Ontarians are looking for relief. Rather than throwing billions of dollars to nearly every government department, Ford had an opportunity to offer meaningful long-term tax relief for Ontario families. Instead, he chose to go on a spending bonanza.
Ontario’s debt is now projected to pass $450 billion by the end of the year. Bondholders on Bay Street are going to rake in over $13 billion in interest charges alone in 2022-23. For perspective, with that same $13 billion, the Ontario government could cut the provincial portion of the HST from eight per cent to five per cent. Clearly, deficits do matter.
Budgeting is all about priorities. Ford could have prioritized the best interests of taxpayers by stopping Ontario’s deeper dive into debt and lowering taxes. Instead, he’s chosen to compete with his political opponents over who can spend the most money the fastest. And, based on the opposition’s platforms, that competition is hot.
Ford now suggests his party would take another five years to balance the books. That’s four years longer than the FAO’s sensible fiscal plan. Del Duca’s Liberals plan to spend more money, but keep the same balanced budget target. Meanwhile, Horwath’s NDP hasn’t even set a balanced budget date and would ramp up sending as well.
Clearly, Ontarians are at a restaurant where nothing on the menu is appetizing. Everything is greasy and full of carbs. Many Ontarians are likely thinking of having a glass of water and bolting from the restaurant to look for a healthier option.
But there’s still time for a better dish to make its way onto the menu. Ford, Del Duca, or Horwath could seize the moment and recognize that the elephant in the room in this election is affordability.
Importantly, affordability doesn’t mean more government programs that make taxpayers worse off. Real proposals to enhance affordability would promote lower deficits and lower taxes.
The competition for the pro-taxpayer vote is wide open. It’s time for one of the leaders to seize the moment.
Jay Goldberg is the Ontario Director for the Canadian Taxpayers Federation.
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Troy Media is an editorial content provider to media outlets and its own hosted community news outlets across Canada.