Minister’s Foreword
This is a Budget for the people, by the people and one that, after years of neglect, puts the people first. It builds on the progress our government has made over the past nine months to deliver on our five core commitments. They are to:
- Put more money in people’s pockets;
- Create and protect jobs;
- Restore accountability and trust in government;
- Clean up the hydro mess; and
- Cut hospital wait times and end hallway health care.
During the development of the 2019 Ontario Budget, members of our government fanned out across the province to meet with and listen to individuals, families and business owners. We heard first-hand about the struggles people are facing in a province that is overtaxed and overregulated, and where the services we cherish most are being threatened by spiralling costs and a high provincial debt burden and deficit.
Cabinet and caucus colleagues also provided specific Budget ideas put forth by constituents from all walks of life. In addition, thousands of people took the time to email us, mail us letters and complete online budget submissions with thoughtful and practical ideas to help fix the government and deliver value for money. We thank everyone for taking part in this incredibly important initiative.
Without question, our government inherited a significant fiscal challenge. The previous government left us with a $15 billion deficit. When we came to office, the previous government had been spending $40 million a day more than it was receiving in revenue. Our province now has the largest subnational debt in the world at $343 billion in 2018–19, strapping Ontario taxpayers with interest payments that are larger than the annual budgets of most provincial ministries. The previous government’s actions were both irresponsible and reckless. And we are now fixing that.
The vast majority of the people we speak with understand the fundamental need to get our fiscal house in order and focus on balancing the budget and reducing the debt burden. Every dollar we are spending on interest payments is a dollar we are not using to support critical front-line services like those in our hospitals, our schools and for child care.
To deal with this unsustainable fiscal situation, our government launched a line-by-line review of all spending within our government ministries and agencies. We acted immediately and imposed a hiring freeze, restricted travel, meals and hospitality, and clamped down on discretionary spending. We set out to spend smarter and work smarter, and to find efficiencies across government. We are taking deliberate steps to reinvent government in order to put the province back on a sound financial footing and we are seeing progress. In 2018–19, the government reduced the inherited $15 billion deficit by $3.3 billion while delivering $2.7 billion in much-needed relief to individuals, families and businesses.
We are taking a balanced approach to government. We are putting money back in people’s pockets, making Ontario open for business and open for jobs and at the same time, reducing the deficit. We are mapping out a reasonable and responsible path to balance. We are proud to say that we will achieve a balanced budget by 2023–24, while protecting what matters most to Ontario individuals, families and businesses.
We firmly believe it is time that government held itself to the same customer service standards as private sector businesses. This means taking nothing for granted and putting the customer, or in our case, the citizen and the taxpayer first. It also means putting people at the centre of government.
For too long, individuals, families and businesses have been forced to feel like they are working for the government. It’s about time that your government started working for you. That is Premier Doug Ford’s approach. That is the approach of your Government for the People.
We encourage everyone to read the following pages. The 2019 Ontario Budget lays out a plan that restores the accountability of government and the people of Ontario’s trust in it, and puts an end to an unacceptable culture of waste and mismanagement.
Sincerely,
[Original Signed by]
The Honourable Victor Fedeli
Minister of Finance
Introduction
For nine months, Ontario’s Government for the People has been moving swiftly and decisively to deliver on the promises it made to the people of Ontario. Since taking office, the government has enacted almost 200 initiatives to fulfill these commitments (see Promises Made, Promises Kept for more details). However, more hard work lies ahead to put Ontario back on a healthy financial footing and secure a bright future for the province.
The government has worked tirelessly to put more money in people’s pockets, clean up the hydro mess, create and protect jobs, end hallway health care and restore trust, transparency and accountability in government.
For the better part of the last 15 years, the previous government chose to recklessly spend money it did not have by racking up debt while families and individuals in Ontario struggled to make ends meet. The people of Ontario have been left deeply mired in red ink by the previous government’s determination to spend well beyond its means.
Today, Ontario’s fiscal position makes the province more vulnerable to future economic shocks. Ontario inherited a $15 billion deficit from the previous government, which was spending $40 million more a day than it was receiving in revenues. The Province has the largest subnational debt in the world at $343 billion. Interest on debt payments are the fourth largest line item in the budget after health care, education and social services.
Without immediate action, this mountain of debt will put vital and cherished public services, including Ontario’s world-class health care and education systems at risk.
The government must fix Ontario’s inherited fiscal mess and restore balance before it hurts the economy, jobs and the people who depend the most on critical government services every day.
Balancing the budget is not an end in and of itself. Nevertheless, it is the only way the government can ensure that hospitals, schools and other key public services have the sustainable funding they need.
The government must work to put its annual budget in the black and reduce the debt burden to ensure future generations are not saddled with the full weight of this burden.
Instead, the government must work to leave a legacy of hope for future generations, built on the progress it has made so far to restore the sacred bond of trust between people and their government.
Ontario’s Plan for Putting People First
The first Budget of Ontario’s Government for the People lays out a plan to set Ontario down the right path.
Restoring Fiscal Balance
The government is fulfilling its promise to the people of Ontario to restore trust by introducing a plan to balance the budget according to a realistic and responsible timetable. The Province will restore fiscal balance by 2023–24 by achieving savings and cost avoidance of about eight cents for every dollar spent, on average, over this period. The government will also move forward with a debt burden reduction strategy that helps preserve critical government services and makes life more affordable for the hard-working people in this province.
The government will also continue to restore trust, transparency and accountability through the ongoing review of government spending and proposed new legislative measures to protect Ontario taxpayers.
Putting People First
The government’s plan promotes choice and convenience for all Ontario individuals, families and businesses. This will begin with a renewed commitment to deliver a simple, responsive and consistent approach to the customer experience that has long been the standard in the private sector. That means using technology to make government services more user-friendly and applying a productivity and value-for-money lens to everything government does.
To that end, the Province is adopting a digital-first strategy that will enable it to take advantage of the best tried-and-true technologies to improve how people and businesses access government services and reduce the costs of the system.
The government will continue to work to make life more affordable for consumers. It is putting drivers first with a new blueprint to fix Ontario’s broken auto insurance system. It is taking action to provide electricity bill relief to help put more money in people’s pockets. This includes replacing Global Adjustment refinancing while providing more transparent on-bill electricity price relief, and ensuring that compensation paid to Hydro One executives is not funded from electricity rates. The Province is continuing to improve choice and convenience for Ontario’s consumers through the expansion of beer and wine to corner stores, big box stores and more grocery stores.
The government is working with its partners and moving forward with building a world-class transit and transportation system in the province. In the Greater Toronto and Hamilton Area (GTHA), the government is investing in priority transit projects, including the new “Ontario Line” subway project, the Scarborough Subway Extension and the Yonge North Subway Extension, as well as the western extension of the Eglinton Crosstown Light Rail Transit line.
Provincial delivery of these priority transit projects will enable the government to speed up expansion and improvements to the network to ensure commuters can travel to and from home in a convenient and timely manner.
In addition, the Province is investing in the GO Rail Expansion Program, which will transform the GO Transit rail network into a comprehensive, all-day rapid transit network. The government is also investing in transit and transportation outside the GTHA, such as funding its share of Stage 2 of the City of Ottawa’s Light Rail Transit project.
Ongoing investments in Metrolinx and transportation projects throughout the province will ensure Ontario is meeting the needs of travellers and businesses, thereby helping to boost local economies and create jobs.
Protecting What Matters Most
The government is making life easier for Ontario families so they can focus on what matters most: raising their children and setting them up for success. The government is investing $1.7 billion in 2019–20 to help families access child care and early years programs to support them while they earn a living. The government is also listening to parents and consulting with education partners to improve Ontario’s education system from kindergarten to Grade 12 while pursuing a more sustainable path forward.
In addition, the government is proposing a new Childcare Access and Relief from Expenses (CARE) tax credit with an estimated annual cost of $390 million. The new tax credit would provide up to 75 per cent of eligible child care expenses so that families can go to work, run a business, or study to acquire new skills. The CARE tax credit would ensure working families keep more of their hard‑earned money and enable them to choose the kind of care that is best for their children. The CARE tax credit would be one of the most flexible child care initiatives ever introduced in Ontario.
The government is also proposing to provide tax relief to families when they need it most by reducing the burden of the Estate Administration Tax.
The government is building a public health care system centred on the patient and redirecting money to front-line services — where it belongs — to improve the patient experience. Patients and families will have access to faster, better and more connected services in a system in which family doctors, hospitals, and home and community care providers work as a team to cover the patient’s entire circle of care.
The government’s plan is focused on helping the most vulnerable people in society. Seniors in need will receive the quality care they deserve by providing publicly funded dental care and more long-term care beds; 23,000 children with autism will move off the waitlist. Furthermore, the government will invest $3.8 billion in mental health and addictions services and housing support over the next decade to help more patients get the expert care they need.
This is what a government for the people does — protect what matters most.
Open for Business, Open for Jobs
Restoring fiscal health goes hand in hand with improving Ontario’s economic health. Since taking office, the government has sent a clear message that Ontario is open for business and open for jobs. Early actions by the government, such as cancelling the cap-and-trade carbon tax and keeping the minimum wage at $14 per hour, combined with the reduction in WSIB premiums are making Ontario a more attractive place to invest, grow a business and create jobs. Since June 2018, these efforts have already yielded results with 132,000 net new jobs created.
To further encourage business investment and job creation, the Province is delivering early on its commitment to cut corporate income taxes through the Ontario Job Creation Investment Incentive. The Incentive includes an immediate 100 per cent writeoff for manufacturing and processing machinery and equipment and for clean energy equipment, and an accelerated writeoff for most other assets. The Incentive provides Ontario businesses with $3.8 billion in Ontario tax relief over six years.
The government’s auto sector plan, Driving Prosperity, sets out a 10-year vision for how the industry, the research and education sector, and all three levels of government can work together to strengthen the auto sector’s competitiveness. The government is creating an environment where the auto industry can thrive, grow and innovate, and where businesses throughout Ontario will enjoy the offshoot benefits of a strong auto sector.
Reducing the burden of unnecessary, outdated or duplicative regulations that hurt the ability of Ontario businesses to compete and create jobs remains a top priority for the government. To meet the target of providing businesses with over $400 million in ongoing savings from their compliance costs, the government will be introducing red tape reduction legislation each fall and spring throughout its mandate.
The government is investing in the workforce of the future. It is making postsecondary education more affordable by reducing tuition fees by 10 per cent for domestic students and restoring fiscal sustainability to the Ontario Student Assistance Program to ensure the government can continue to help those students who need it most. The Province will continue to reduce the regulatory burden on skilled tradespeople in order to increase apprenticeship opportunities and help address the skilled labour shortage.
The government is actively working with provincial partners, including the governments of Saskatchewan and New Brunswick, to oppose the federal job-killing carbon tax, which came into effect on April 1. Ontario is also legally challenging the federal carbon tax in both the Saskatchewan and Ontario Courts of Appeal. Ontario’s Government for the People is also acting to ensure the federal government is unable to hide the true cost of its punishing carbon tax from Ontario workers, families and businesses by proposing to implement transparency measures to disclose the true cost of the carbon tax on home heating bills and at the gas pump. And Ontario will soon commence a public interest information campaign designed to contrast the federal government’s reliance on the carbon tax with the Ontario government’s plan to fight climate change, which will meet greenhouse gas emissions reduction targets without a carbon tax.
Conclusion
The people of Ontario can count on their government to protect what matters most to them. It will maintain world-class health care and education systems. It will protect jobs for Ontario workers and make Ontario the best place in the world to do business and create jobs. It will make life easier for Ontario families and individuals by ensuring government embraces the level of customer service that people have come to expect from private sector businesses. It will respect taxpayers and deliver value for money for each tax dollar spent.
Ontario’s Government for the People will stand up for the “little guy,” individuals who simply want to see a government that appreciates how hard they work to support themselves and their families, how much they already pay, and how much of a struggle it is to get by, and is ready to continue to make their lives easier and more affordable.
In short, this is a government that will put the people first and protect what matters most.
“Our 2019 Budget for the People focuses on restoring confidence in Ontario’s finances and bringing jobs and growth back to this province so that we can protect what matters most — our hospitals, schools and other vital public services — for this generation and the next.”
[Original Signed by]
The Honourable Victor Fedeli
Minister of Finance