2020 Ontario Budget — Ontario's Action Plan: Protect, Support, Recover

The Honourable Rod Phillips, Minister of Finance

Table of Contents

Introduction

Ontario’s Economic and Fiscal Outlook in Brief

• Ontario’s Economic and Fiscal Outlook in Brief
• Ontario’s Economic Outlook
  • Enhancing Transparency: Alternative Economic Scenarios
• Managing Ontario’s Finances Responsibly
• Ontario’s Fiscal Plan
  • Program Expense Details
  • Revenue Details
  • Other Fiscal Plan Assumptions
• Borrowing and Debt Management
  • Progress Report on Debt Burden Reduction Strategy
  • Net Debt-to-GDP
• Ontario’s Capital Plan

Chapter 1: Ontario’s Action Plan: Protect, Support, Recover

Section A: Protect — Urgent COVID‑19 Response

• Introduction
• Ontario’s Immediate COVID‑19 Health Response
• Protecting People’s Health during the Second Wave
  • 1. Maintaining Strong Public Health Measures, including Continued Expansion of Testing and Case and Contact Management
  • 2. Implementing the Largest Flu Immunization Campaign in Ontario's History
  • 3. Identifying, Managing and Preventing COVID‑19 Outbreaks
  • 4. Accelerating Efforts to Reduce Surgical Backlogs
  • 5. Preparing for Surges in COVID‑19 Cases
  • 6. Recruiting, Retaining, Training and Supporting Health Care Workers
• Protecting Our Loved Ones in Long-Term Care Homes
  • Supporting a Timely Response to the COVID‑19 Outbreak
  • Long-Term Care Staffing Strategy — Increasing Hours of Care
  • Investing in Personal Support Workers
  • Accelerating Bed Development and Increasing Sector Capacity
  • Piloting Community Paramedicine for Long-Term Care
  • Committing to Continuous Improvement
• Supporting People Suffering from Mental Health and Addictions Challenges
  • Increasing Mental Health Funding for Postsecondary Students
• Continuing the Commitment to a Strong Health Care System
  • Investing in Ontario’s Hospitals
  • Building Infrastructure Capacity in Ontario Hospitals
• Protecting Workplaces
  • Hiring More Occupational Health and Safety Inspectors
  • Providing COVID‑19 Workplace Safety Guidelines
  • Renewing the Provincial Occupational Health and Safety Strategy
  • Enhancing Infection Prevention and Control Capacity in the Social Services Sector
• Building an Emergency Volunteer Unit

Section B: Support — Support for People and Jobs

• Introduction
• Supporting People
  • Helping Parents with COVID‑19 Costs
  • Reopening Schools Safely
  • Helping Elementary Students Learn Online
  • Creating a Digital Learning Portal
  • Building and Renovating Schools and Child Care Spaces
  • Helping University and College Students Navigate COVID‑19
  • Helping Seniors Make Their Homes Safer
  • Delivering Meals, Medicine and Other Essentials to Vulnerable People
  • Expanding the Seniors Active Living Centre Program
  • Launching the Inclusive Community Grants Program
  • Doubling Investment in the Black Youth Action Plan
  • Investing in the Special Services at Home Program
  • Supporting Agricultural and Horticultural Societies
  • Ontario’s Community Building Fund
  • Supporting Local Festivals and Events
  • Assisting Ontario’s Arts Institutions
  • Supporting Sports and Recreation
  • Supporting Francophone Non-Profits
  • Supporting People Facing a Mental Health Crisis
  • Supporting Survivors of Domestic Violence and Human Trafficking
  • Providing Electricity Cost Relief to Ontario Families
• Supporting Jobs
  • Supporting Employers in COVID‑19 Hotspots
  • Supporting Main Street Businesses
  • Supporting Small Businesses with Rent
  • Supporting Consumers, Hospitality Businesses and Alcohol Producers
  • Ontario Together: Helping Businesses Retool to Fight against COVID‑19
  • Protecting Workers, Volunteers, and Organizations Who Make Honest Efforts to Follow COVID‑19 Public Health Guidelines
  • Improving the Business Climate for Indigenous Communities and Northern Municipalities
  • Supporting Indigenous-Owned Businesses during COVID‑19
  • Helping Northern Businesses
  • Supporting the Commercial Fishing Industry
• Supporting Municipal Partners
  • Working Together to Support Municipalities through COVID‑19
  • Postponing the Property Tax Reassessment and Helping to Defer Property Tax Payments
  • Providing Stability through the Ontario Municipal Partnership Fund

Section C: Recover — Creating the Conditions for Growth

• Introduction
• A Comprehensive Plan to Reduce Job-Killing Electricity Prices
  • More Competitive Electricity Prices for Growth and Job Creation
  • Reducing Job-Killing Electricity Prices
  • Making Ontario Competitive
  • A Plan to Responsibly Wind Down High-Cost Contracts
• Reducing Taxes on Jobs
  • Reducing Property Taxes for Job Creators
  • Property Tax Relief for Small Businesses
  • Lowering Payroll Taxes for Private-Sector Employers
• Retraining and Skilled Trades
  • COVID‑19 Recovery Assistance Skills Plan
  • Ontario’s Skilled Trades Strategy
  • Supporting Workers to Acquire In-Demand Skills
  • Redesigning Second Career
  • Giving Workers New Pathways to Good Jobs
  • Enhancing Canada-Ontario Workforce Development Agreements
  • Building Pathways to Careers in Corrections
  • Including Women in Ontario’s Economic Recovery
• Reducing Unnecessary Red Tape
• Supporting Ontario’s Sectors
  • Tourism
  • Modernizing Ontario’s Financial Services Sector
  • Generating, Protecting and Commercializing Intellectual Property
  • Invest Ontario
  • Promoting Ontario Made Products
  • Supporting Growth Through Interprovincial Trade
  • Growing the Agri-Food Sector
  • Helping Ontario’s Forestry Sector Reach its Full Potential
  • Supporting Small Modular Reactors in Ontario
  • Supporting the Environment, Parks and Conservation
• Building Infrastructure
  • Next Phase of Broadband Investments
  • Accelerating the Delivery of the New Subway Transit Plan
  • Modernizing the GO Transit Rail Network
  • Building Highways, Roads and Bridges
  • Ontario Place Development
  • Building Universities and Colleges
  • Implementing the Investing in Canada Infrastructure Program
• Modernizing Government
  • Moving Ontario Onwards
  • Consulting on Unregulated Tobacco
  • Establishing a Market for Internet Gaming (iGaming) in Ontario
  • Creating Opportunities through the Value Creation Task Force
  • Supporting Sustainable Collective Bargaining Outcomes in the Public Sector
  • Supporting the Sustainability and Affordability of Public-Sector Pension Plans

Chapter 2: Recent Economic Performance and Outlook

• Introduction
• Recent Economic Performance
• Economic Outlook
  • Global Economic Environment
  • Details of Ontario’s Economic Outlook
  • Significant Revision to the Ontario Outlook since the 2019 Budget
  • Risks to the Outlook
  • Economic Outlook Scenarios

Chapter 3: Ontario’s Fiscal Plan and Outlook

• Introduction
• Key 2020–21 Changes
  • Revenue
  • Expense
  • Prudence
• Medium-Term Fiscal Plan
  • Medium-Term Revenue Outlook
  • Revenue Outlook Scenarios
  • Medium-Term Expense Outlook
  • Prudence
• Transparency and Risks
• Details of Ontario’s Finances

Chapter 4: Borrowing and Debt Management

• Introduction
• Borrowing Program
• Green Bond Program
• Net Debt-to-GDP
• Cost of Debt
• Ensuring Adequate Liquidity Levels
• Consolidated Financial Tables

Annex: Details of Tax Measures and Other Legislative Initiatives

• Introduction
• Reducing the Employer Health Tax
• Helping Seniors Stay Safely in Their Homes
• Maintaining Cultural Media Tax Credit Eligibility
  • Ontario Film and Television Tax Credit
  • Ontario Production Services Tax Credit
  • Ontario Interactive Digital Media Tax Credit
  • Ontario Book Publishing Tax Credit
• Supporting Research and Development
• Reducing Property Taxes for Employers
• Enabling Property Tax Relief for Small Businesses
• Reviewing Ontario’s Property Assessment and Taxation System
  • New Assessment Tools for Redevelopment Areas
  • Enhancing Assessment Accuracy and Stability
• Cancelling the Scheduled Wine Tax Increase and Freezing Beer Tax Rates
• Summary of Measures
• Technical Amendments
  • Taxation
  • Other Legislative Initiatives

2021 Budget Consultations

List of Tables

Ontario’s Economic and Fiscal Outlook in Brief

• Summary of Ontario’s Economic Outlook
• Ontario’s Real GDP Growth Scenarios
• Fiscal Updates by Jurisdiction
• Ontario’s Fiscal Plan
• Extraordinary Contingencies and Time-Limited Pandemic Response
• 2020–21 Borrowing Program and Medium-Term Outlook
• Infrastructure Expenditures

Chapter 1: Ontario’s Action Plan: Protect, Support, Recover

• Table 1.1 Summary of Incremental Increases to the Construction Funding Subsidy and New Upfront Capital Investments

Chapter 2: Recent Economic Performance and Outlook

• Table 2.1 Summary of Ontario’s Economic Outlook
• Table 2.2 Private-Sector Forecasts for Ontario Real GDP Growth
• Table 2.3 External Factors
• Table 2.4 The Ontario Economy, 2019 to 2023
• Table 2.5 Impact of Sustained Changes in Key External Factors on Ontario’s Real GDP Growth
• Table 2.6 Ontario’s Real GDP Growth Scenarios

Chapter 3: Ontario’s Fiscal Plan and Outlook

• Table 3.1 Fiscal Summary
• Table 3.2 2020–21 In-Year Fiscal Performance
• Table 3.3 Key Changes to 2020–21 Revenue Projections
• Table 3.4 Key Changes to 2020–21 Total Expense Projections
• Table 3.5 Summary of Medium-Term Revenue Outlook
• Table 3.6 Summary of Medium-Term Cannabis-Related Revenue
• Table 3.7 Selected Economic and Revenue Risks and Sensitivities
• Table 3.8 Ontario’s Taxation Revenue Scenarios
• Table 3.9 Summary of Medium-Term Expense Outlook
• Table 3.10 Extraordinary Contingencies and Time-Limited Pandemic Response
• Table 3.11 Selected Expense Sensitivities
• Table 3.12 Revenue
• Table 3.13 Total Expense
• Table 3.14 Infrastructure Expenditures
• Table 3.15 Ten-Year Review of Selected Financial and Economic Statistics

Chapter 4: Borrowing and Debt Management

• Table 4.1 2020–21 Borrowing Program and Medium-Term Outlook
• Table 4.2 Evolution of Ontario Borrowing Rate Assumptions
• Table 4.3 Net Debt and Accumulated Deficit
• Table 4.4 Medium-Term Outlook: Net Debt and Accumulated Deficit

Annex: Details of Tax Measures and Other Legislative Initiatives

• Table A.1 Summary of Proposed Cultural Media Tax Credit Amendments
• Table A.2 Business Education Tax Cuts in 2021
• Table A.3 Summary of Measures

List of Charts

Introduction

• Ontario’s Action Plan: Protect, Support, Recover

Ontario’s Economic and Fiscal Outlook in Brief

• Employment Change Compared to Previous Major Downturns
• Unprecedented Private-Sector Forecast Uncertainty
• Range of Ontario Real GDP Scenario Forecasts
• Range of Ontario Deficit Outlook Scenarios
• Total Health Sector and COVID‑19 Response Funding
• Net Debt-to-GDP
• Range of Long-Term Borrowing Outlook Scenarios

Chapter 1: Ontario’s Action Plan: Protect, Support, Recover

• Chart 1.1 Examples of Long-Term Care Development Projects Underway
• Chart 1.2 Examples of Health Facility Projects under Construction or in Planning
• Chart 1.3 Canada Health Transfer National Entitlement: A Fair Federal Share vs. the Status Quo
• Chart 1.4 Examples of School Projects Recently Approved
• Chart 1.5 Illustrative Relief for a Restaurant
• Chart 1.6 Electricity Prices for Commercial and Industrial Employers
• Chart 1.7 Lowering Electricity Bills – Illustrative Industrial Employer
• Chart 1.8 Lowering Electricity Bills – Illustrative Commercial Employer
• Chart 1.9 Providing Electricity Cost Savings for Industrial and Commercial Employers
• Chart 1.10 Improving Competitiveness: Average Electricity Pricing for Commercial and Industrial Employers
• Chart 1.11 Costs Shiftid to the Province are Forecast to Decline under the Government’s Plan
• Chart 1.12 Illustrative Savings for a Commercial Property in London
• Chart 1.13 Illustrative Savings for an Industrial Property in Windsor
• Chart 1.14 Illustrative Property Tax Savings for a Bakery Shop in Toronto
• Chart 1.15 Illustrative Tax Relief Before and After the Increase to the Employer Health Tax Exemption from $490,000 to $1 Million
• Chart 1.16 Examples of Highway Expansion Projects in Planning or Underway
• Chart 1.17 Investing in Canada Infrastructure Program – Public Transit Stream: Supporting Municipal Transit across the Province

Chapter 2: Recent Economic Performance and Outlook

• Chart 2.1 Second Quarter 2020 Real GDP Declines are Widespread
• Chart 2.2 Ontario’s Unemployment Rate and Major Downturns
• Chart 2.3 Key Economic Indicators Showing Signs of Recovery
• Chart 2.4 Confidence Rebounding
• Chart 2.5 Unprecedented Private-Sector Forecast Uncertainty
• Chart 2.6 10-Year Canadian Bond Rate Projections
• Chart 2.7 Real GDP Forecast Comparison
• Chart 2.8 Unprecedented Private-Sector Forecast In-Year Change
• Chart 2.9 Range of Ontario Real GDP Scenario Forecasts

Chapter 3: Ontario’s Fiscal Plan and Outlook

• Chart 3.1 Range of Ontario Deficit Outlook Scenarios
• Chart 3.2 Total Health Sector and COVID‑19 Response Funding
• Chart 3.3 Composition of Revenue, 2020–21
• Chart 3.4 Composition of Total Expense, 2020–21

Chapter 4: Borrowing and Debt Management

• Chart 4.1 Range of Long-Term Borrowing Outlook Scenarios
• Chart 4.2 2020–21 Borrowing
• Chart 4.3 Domestic and International Borrowing
• Chart 4.4 Green Bond Allocation by Framework Category
• Chart 4.5 Ontario’s Green Bond Issues
• Chart 4.6 Net Debt-to-GDP
• Chart 4.7 Effective Interest Rate (Weighted-Average) on Total Debt
• Chart 4.8 Average Annual Ontario Borrowing Rates
• Chart 4.9 Weighted-Average Term of Borrowings
• Chart 4.10 Interest on Debt-to-Revenue Ratio
• Chart 4.11 Average Unrestricted Liquid Reserve Levels

Annex: Details of Tax Measures and Other Legislative Initiatives

• Chart A.1 Distribution of Current Business Education Tax Rates above Proposed 2021 Rate