Chapter 3: Continuing to Invest in the Plan to Build: Ontario’s Fiscal Plan and Outlook

Introduction

With economic headwinds weighing on household and government finances, it is more important than ever to continue investing in Ontario’s Plan to Build and to keep costs down and taxes low. While Ontario’s economy has remained resilient, it is expected to reflect continued but slower growth in 2024, compared to the projection in the 2023 Budget.

This slower projected growth and other factors beyond the province’s control — such as lower tax assessments and the federal government’s cap on international student study permit applications — have put new pressures on government finances. But the government will not stop investing in growth, infrastructure, economic development and communities across Ontario, and will also not raise taxes or fees at a time when families and businesses are struggling.

For 2023–24, the government is projecting a deficit of $3.0 billion. Over the medium term, the government is projecting deficits of $9.8 billion in 2024–25 and $4.6 billion in 2025–26, before reaching a surplus of $0.5 billion in 2026–27. The government’s plan retains a path to balance the budget despite a fiscal deterioration relative to the outlooks in Ontario’s 2023 Budget and the fall 2023 Ontario Economic Outlook and Fiscal Review.

Chart 3.1:
Accessible description of Chart 3.1

A strong federal–provincial partnership is also key to Ontario’s long-term fiscal sustainability. While Ontario and the federal government have recently achieved agreements on health funding, Ontario continues to make new investments in critical health services while also facing increased cost pressures. More is needed to be done to ensure the Canada Health Transfer provides adequate funding going forward. In addition, with significant new infrastructure investments announced in Ontario’s 2024 Budget, Ontario is calling on the Government of Canada to build on these actions to support municipalities and to get shovels in the ground on housing-enabling infrastructure.

Table 3.1
Fiscal Summary
($ Billions)
  Actual
2022–23
Interim1
2023–24
Medium-Term
Outlook
2024–25
Medium-Term
Outlook
2025–26
Medium-Term
Outlook
2026–27
Revenue 192.9 204.3 205.7 217.4 226.6
Expense — Programs 186.4 194.5 200.6 205.8 208.9
Expense — Interest on Debt 12.4 12.8 13.9 14.7 15.2
Total Expense 198.8 207.3 214.5 220.6 224.1
Surplus/(Deficit) Before Reserve (5.9) (3.0) (8.8) (3.1) 2.5
Reserve 1.0 1.5 2.0
Surplus/(Deficit) (5.9) (3.0) (9.8) (4.6) 0.5
Net Debt as a Per Cent of GDP 38.2% 38.0% 39.2% 39.5% 39.1%
Net Debt as a Per Cent of Revenue 207.6% 203.0% 213.5% 211.4% 209.4%
Interest on Debt as a Per Cent of Revenue 6.4% 6.3% 6.8% 6.8% 6.7%

Table 3.1 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.  
Notes: Numbers may not add due to rounding. Interim and medium-term outlook primarily reflect information available as of February 28, 2024.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

2023–24 Interim1 Fiscal Performance

Ontario’s 2023–24 deficit is projected to be $3.0 billion — $1.7 billion higher than the outlook published in the 2023 Budget but $2.6 billion lower than the outlook published in the 2023 Ontario Economic Outlook and Fiscal Review. It is also $1.6 billion lower than the outlook published in the 202324 Third Quarter Finances.

The 2024 Budget is projecting revenues in 2023–24 to be $204.3 billion — slightly lower than forecast in the 2023 Budget. Declines in taxation revenue and Government of Canada transfers are mostly offset by gains in net income from Government Business Enterprises and Other Non-Tax Revenue.

Program expense is projected to be $194.5 billion, $3.8 billion higher than the 2023 Budget forecast.

Ontario is forecast to pay $12.8 billion in interest costs in 2023–24 — lower than the forecast in the 2023 Budget, mainly due to lower than projected borrowing costs. At 38.0 per cent, the net debt‐to‐GDP ratio in 2023–24 is forecast to be 0.2 percentage point higher than in the 2023 Budget, primarily due to a modestly higher than forecast deficit and investments in infrastructure.

The 2023 Budget also included a $1.0 billion reserve in 2023–24 to protect the fiscal plan against unforeseen adverse changes in Ontario’s revenue and expense forecasts. The reserve was not required at fiscal year-end and has been drawn down to zero at interim, reducing the deficit further.

Table 3.2
2023–24 In-Year Fiscal Performance
($ Millions)
  2023 Budget Interim1
2023–24
In-Year
Change
Revenue 204,367 204,336 (32)
Expense — Programs 190,622 194,470 3,848
Expense — Interest on Debt 14,058 12,843 (1,215)
Total Expense 204,680 207,313 2,633
Surplus/(Deficit) Before Reserve (313) (2,977) (2,665)
Reserve 1,000 (1,000)
Surplus/(Deficit) (1,313) (2,977) (1,665)
 

Table 3.2 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

Notes: Numbers may not add due to rounding. Interim and medium-term outlook primarily reflect information available as of February 28, 2024.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Revenue Update

The 2023–24 total revenue outlook is $204.3 billion — slightly lower than projected in the 2023 Budget. Since the release of the most recent update as part of the 2023–24 Third Quarter Finances, total revenue is projected to increase by $1.6 billion due to higher Taxation Revenue, Other Non-Tax Revenue and Net Income from Government Business Enterprises, after factoring in a decline in Government of Canada Transfers.

Table 3.3
Summary of 2023–24 Revenue Changes Since the 2023 Budget
($ Millions)
  Interim1
2023–24
2023 Budget Total Revenue 204,367
Revenue Changes in the 2023–24 First Quarter Finances 0.2
Revenue Changes in the 2023 Ontario Economic Outlook and Fiscal Review (2,566)
Revenue Changes in the 2023–24 Third Quarter Finances 942
Revenue Changes Since the 2023–24 Third Quarter Finances — Corporations Tax 2,410
Revenue Changes Since the 2023–24 Third Quarter Finances — Electricity Payments in Lieu of Taxes (9)
Revenue Changes Since the 2023–24 Third Quarter Finances — Personal Income Tax (1,281)
Total Taxation Revenue 1,119
Government of Canada Transfers (394)
Government Business Enterprises 475
Other Non-Tax Revenue 392
Total Revenue Changes Since the 2023–24 Third Quarter Finances 1,592
Total Revenue Changes Since the 2023 Budget (32)
2024 Budget Total Revenue Outlook 204,336

Table 3.3 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

Notes: Numbers may not add due to rounding. Interim and medium-term outlook primarily reflect information available as of February 28, 2024.

Source: Ontario Ministry of Finance.

The forecast for Total Taxation Revenue has increased by $1,119 million compared to the 2023–24 Third Quarter Finances. Key changes in the taxation revenue outlook include:

  • Corporations Tax revenue projections increased by $2,410 million, mainly due to a stronger than expected corporate profit outlook than anticipated mid-way through 2023–24;
  • Electricity Payments in Lieu of Taxes (PILs) revenue projections decreased by $9 million, reflecting a lower Municipal Electricity Utilities PILs forecast; and
  • Personal Income Tax revenue projections decreased by $1,281 million, reflecting anticipated weaker taxable income growth for 2023.

Government of Canada Transfers projections decreased by $394 million, mainly due to a reprofiling of funding under the Canada-wide Early Learning and Child Care Agreement and Investing in Canada Infrastructure Program.

Net income from Government Business Enterprises projections increased by $475 million, due to a higher forecast for income from Ontario Power Generation (OPG) reflecting a revised consolidation adjustment under International Financial Reporting Standards (IFRS).

Other Non-Tax Revenues projections increased by $392 million, largely due to higher revenue resulting from recoveries of prior-year expenditures and updates from consolidated government organizations.

Expense Update

Since the release of the 2023 Budget, the government has made targeted investments throughout the fiscal year to continue to make progress on Ontario’s Plan to Build while also investing in critical public services. The 2023–24 total expense outlook is $207.3 billion, $2.6 billion higher than the 2023 Budget.

Since the release of the most recent update as part of the 2023–24 Third Quarter Finances, the total program expense projection has increased by $1.1 billion, primarily due to compensation costs and higher than forecasted ministry spending.

Table 3.4
Summary of 2023–24 Expense Changes Since the 2023 Budget
($ Millions)
  Interim1
2023–24
2023 Budget Total Expense 204,680
Total Expense Changes in the 2023–24 First Quarter Finances 0.2
Total Expense Changes in the 2023 Ontario Economic Outlook and Fiscal Review 1,734
Total Expense Changes in the 2023–24 Third Quarter Finances (136)
Program Expense Changes Since the 2023–24 Third Quarter Finances — Health Sector 1,581
Program Expense Changes Since the 2023–24 Third Quarter Finances — Education Sector2 1,881
Program Expense Changes Since the 2023–24 Third Quarter Finances — Postsecondary Education Sector (116)
Program Expense Changes Since the 2023–24 Third Quarter Finances — Children, Community and Social Services Sector 44
Program Expense Changes Since the 2023–24 Third Quarter Finances — Justice Sector 638
Program Expense Changes Since the 2023–24 Third Quarter Finances — Other Programs (2,945)
Total Program Expense Changes Since the 2023–24 Third Quarter Finances 1,081
Interest on Debt Change Since the 2023–24 Third Quarter Finances (46)
Total Expense Changes Since the 2023–24 Third Quarter Finances 1,035
Total Expense Changes Since the 2023 Budget 2,633
2024 Budget Total Expense Outlook  207,313

Table 3.4 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

[2] Excludes Teachers’ Pension Plan. Teachers’ Pension Plan expense is included in Other Programs.

Notes: Numbers may not add due to rounding. Interim and medium-term outlook primarily reflect information available as of February 28, 2024.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

The following program expense changes are projected since the release of the 2023–24 Third Quarter Finances:

  • Health sector expense is projected to be $1,581 million higher, primarily to address pressures related to compensation costs, including Bill 124 remedy settlements, and other health services, such as utilization-driven programs like OHIP and the Ontario Public Drug Programs.
  • Education sector expense is projected to be $1,881 million higher, mainly due to compensation costs, including Bill 124 remedy settlements and arbitration outcomes, and higher than forecasted school board spending.
  • Postsecondary Education sector expense is projected to be $116 million lower, mainly due to updates to forecasted expense in the college sector.
  • Children, Community and Social Services sector expense is projected to be $44 million higher, primarily due to investments in the Ontario Autism Program and compensation costs including Bill 124 remedy settlements.
  • Justice sector expense is projected to be $638 million higher, primarily due to compensation costs including Bill 124 remedy settlements and investments related to essential service delivery in corrections, courts, and coroner and forensic pathology services.
  • Other Programs expense is projected to be a net $2,945 million lower, primarily due to the following key changes:
    • $2,772 million drawdown of the Contingency Fund to offset increases in other sectors;
    • $377 million in lower than forecasted spending for the Ministry of Infrastructure, primarily due to revised implementation timelines for infrastructure projects, including the Investing in Canada Infrastructure Program and the Transit-Oriented Communities Program;
    • $118 million in lower than forecasted spending for the Ministry of Labour, Immigration, Training and Skills Development, mainly due to revised implementation timelines for the Skills Development Fund Capital Stream; and
    • $95 million higher than forecasted spending for the Ministry of Agriculture, Food and Rural Affairs, primarily due to higher uptake from the agricultural sector for demand-driven Business Risk Management programming, driven by various factors such as growing conditions.

Interest on debt expense is projected to be $46 million lower due to a lower projected deficit.

Prudence in 2023–24

The Contingency Fund is maintained to help mitigate expense risks that may adversely affect Ontario’s fiscal performance. For the remainder of 2023–24, the Contingency Fund has a current remaining balance of $0.5 billion, which is available to offset additional expenses that may materialize before the end of the fiscal year.

The 2023 Budget included a reserve of $1.0 billion in 2023–24, which was not required and has been drawn down to zero at interim.

Medium-Term Fiscal Plan

The government is projecting deficits of $9.8 billion in 2024–25, $4.6 billion in 2025–26, and a surplus of $0.5 billion in 2026–27. This outlook reflects the government’s continuing investments in infrastructure, housing, economic development and key public services, while not raising taxes or fees.

Key Changes Since the 2023 Budget

Since the 2023 Budget, revenues have decreased by $7.3 billion in 2024–25 and $8.5 billion 2025–26. This is mainly reflecting lower actual tax assessment information from the federal government and slower economic growth over the outlook period. The financial results of colleges are consolidated into the province’s financial statements. As a result of the federal government’s cap on international student study permit applications for two years, a significant downward revision to Broader Public Sector Colleges revenue is also contributing to the decline in 2024–25 and beyond.

Chart 3.2: Sources of Revenue Changes Since the 2023 Budget
Accessible description of Chart 3.2

The total expense outlook is projected to increase from $207.3 billion in 2023–24 to $220.6 billion in 2025–26. Total expense is projected to be higher than forecast at the time of the 2023 Budget as a result of program expense increases, partially offset by interest on debt savings.

The program expense outlook is projected to be higher by $4.2 billion in 2024–25 and $3.4 billion in 2025–26, compared with the medium-term forecast in the 2023 Budget. This increase reflects the government’s commitment to strengthen communities through investments in health, education, infrastructure, and economic development as well as additional compensation-related costs.

Ontario’s medium-term outlook for interest on debt is currently below the 2023 Budget estimate by $0.5 billion in 2024–25 and $0.3 billion in 2025–26, primarily as a result of lower than projected borrowing costs.

The fiscal plan also includes a reserve of $1.0 billion in 2024–25, $1.5 billion in 2025–26 and $2.0 billion in 2026–27, which aligns with long-run historical reserve levels while maintaining a prudent and flexible fiscal plan.

Medium-Term Revenue Outlook

Total revenue is projected to increase from $204.3 billion in 2023–24 to $226.6 billion in 2026–27, for an average annual growth rate of 3.5 per cent. Revenue growth reflects the Ontario Ministry of Finance’s outlook for economic growth and the key economic drivers that underpin the revenue forecast, which are based on private-sector forecasts.

Table 3.5
Summary of Medium-Term Revenue Outlook
($ Billions)
  Actual
2022–23
Interim1
2023–24
Medium-Term
Outlook
2024–25
Medium-Term
Outlook
2025–26
Medium-Term
Outlook
2026–27
Revenue — Personal Income Tax 44.2 50.6 51.9 55.1 58.3
Revenue — Sales Tax 36.1 39.8 38.8 40.6 42.7
Revenue — Corporations Tax 27.8 24.2 24.9 26.3 28.0
Revenue — Ontario Health Premium 4.4 4.9 5.0 5.2 5.4
Revenue — Education Property Tax 6.0 5.8 5.8 5.9 5.9
Revenue — All Other Taxes 18.0 17.2 18.2 20.4 21.0
Total Taxation Revenue 136.5 142.5 144.7 153.5 161.3
Government of Canada 31.3 34.8 36.3 37.5 38.7
Income from Government Business Enterprises 6.1 7.3 6.8 8.0 7.8
Other Non-Tax Revenue 19.0 19.8 18.0 18.5 18.8
Total Revenue 192.9 204.3 205.7 217.4 226.6

Table 3.5 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

Note: Numbers may not add due to rounding.

Source: Ontario Ministry of Finance.

The primary driver of the forecast for Personal Income Tax (PIT) revenues is the outlook for growth in compensation of employees. Personal Income Tax revenue is projected to grow at an average annual rate of 4.9 per cent between 2023–24 and 2026–27.

The forecast for Sales Tax (ST) revenue is driven by the projection for household consumption spending. Average growth in ST revenue is 2.4 per cent between 2023–24 and 2026–27.

The forecast for Corporations Tax (CT) revenue is driven by the projections of corporate profitability. Corporations Tax revenue is projected to grow at an average annual rate of 5.0 per cent between 2023–24 and 2026–27.

The primary driver of the forecast for Ontario Health Premium revenue is the outlook for growth in compensation of employees. Ontario Health Premium revenue is projected to grow at an average annual rate of 3.5 per cent between 2023–24 and 2026–27.

Education Property Tax revenue is based primarily on the outlook for growth in the property assessment base resulting from new construction activities.

Revenues from All Other Taxes are projected to increase at an average annual rate of 6.8 per cent between 2023–24 and 2026–27. This includes revenues from the Employer Health Tax; Land Transfer Tax; Beer, Wine and Spirits Taxes; and volume-based taxes such as the Gasoline Tax, Fuel Tax and Tobacco Tax.

The forecast for Government of Canada Transfers is largely based on existing federal–provincial funding agreements and formulas. Federal transfers are projected to increase at an average annual rate of 3.6 per cent between 2023–24 and 2026–27.

The outlook for Income from Government Business Enterprises (GBEs) is based on Ontario Ministry of Finance estimates of net income for Hydro One Ltd. (Hydro One) and projections provided by Ontario Power Generation (OPG), the Ontario Cannabis Store (OCS), the Liquor Control Board of Ontario (LCBO), the Ontario Lottery and Gaming Corporation (OLG) and iGaming Ontario (iGO). Net incomes of GBEs are projected to increase at an average annual rate of 2.2 per cent from 2023–24 to 2026–27.

The forecast for Other Non-Tax Revenue is based on projections provided by government ministries and agencies. The outlook for Other Non-Tax Revenue is projected to decline at an average annual rate of 1.7 per cent from 2023–24 to 2026–27, largely due to the decrease in third‐party revenues from Broader Public Sector Colleges reflecting the federal government’s cap on international student study permit applications for two years, beginning in 2024.

Risks to the Revenue Outlook

There are a variety of risks to the economic planning assumptions underlying the revenue forecast, as outlined in Chapter 2: Economic Performance and Outlook. Table 3.6 highlights some key risks and sensitivities to the 2024–25 revenue forecast that could arise from unexpected changes in economic conditions. These are only estimates; actual results can vary. The risks identified are based on factors that are considered to have the most material impact on the largest revenue sources.

Table 3.6
Selected Economic and Revenue Sensitivities
Economic Factors Revenue Sources 2024–25 Sensitivities
Nominal GDP Total Taxation Revenue $1,080 million revenue change for each percentage point change in nominal GDP growth. This can vary significantly, depending on the composition and source of changes in GDP growth.
Compensation of Employees Personal Income Tax; Ontario Health Premium; and Employer Health Tax $723 million revenue change for each percentage point change in growth in compensation of employees.
Household Consumption Expenditures Sales Tax $282 million revenue change for each percentage point change in growth of household consumption expenditures.
Net Operating Surplus of Corporations Corporations Tax $228 million revenue change for each percentage point change in growth in net operating surplus of corporations.
Housing Resales and Resale Prices Land Transfer Tax $37 million revenue change for each percentage point change in growth of either housing resales or resale prices.
Ontario Population Share Canada Health Transfer $52 million revenue change for each one-tenth of a percentage point change in Ontario’s population share.
Ontario Population Share Canada Social Transfer $17 million revenue change for each one-tenth of a percentage point change in Ontario’s population share.

Table 3.6 footnotes:

Source: Ontario Ministry of Finance.

Economic and Fiscal Outlook Scenarios

To illustrate the potential impacts of elevated economic uncertainty, the Ontario Ministry of Finance has developed two alternative scenarios that the economy could take over the next several years (see Chapter 2: Economic Performance and Outlook for more details). Based on the two alternative nominal GDP growth economic scenarios, two taxation revenue outlook scenarios were developed. The Faster Growth and Slower Growth scenarios each represent a potential path intended to illustrate a broader range of possible outcomes depending on the pace of economic growth, but neither should be considered as the best case or the worst case.

Table 3.7
Ontario’s Taxation Revenue Scenarios
($ Billions)
  2024–25p 2025–26p 2026–27p
Faster Growth Scenario 148.4 159.7 170.0
Planning Projection 144.7 153.5 161.3
Slower Growth Scenario 141.3 147.9 153.9

Table 3.7 footnotes:

p = Ontario Ministry of Finance Planning Projection and alternative scenarios based on external sources as of January 25, 2024.

Note: Numbers may not add due to rounding.

Source: Ontario Ministry of Finance.

In the Faster Growth scenario, total taxation revenue over the medium term is $8.7 billion higher in 2026–27 than the Planning Projection, while in the Slower Growth scenario, total taxation revenue is $7.4 billion lower.

In the event that the alternative economic scenarios materialize, as opposed to the Planning Projection, Ontario’s fiscal plan would also change as a result.

Under the Faster Growth scenario, the deficit outlook would improve to $6.1 billion in 2024–25, followed by surpluses of $2.0 billion in 2025–26 and $9.7 billion in 2026–27. However, if the Slower Growth scenario materializes, the deficit outlook would deteriorate to $13.3 billion in 2024–25, $10.4 billion in 2025–26 and $7.5 billion in 2026–27.

Chart 3.3: Ontario Fiscal Outlook Scenarios
Accessible description of Chart 3.3

In these alternative outlook scenarios, program expenses are assumed to be unchanged compared to the medium-term expense outlook and only revenue and interest on debt are adjusted.

Medium-Term Expense Outlook

The government is committed to strengthening communities through investments in health care, education, infrastructure, and economic development. The total expense outlook is projected to grow from $207.3 billion in 2023–24 to $224.1 billion in 2026–27.

The government continues to invest in programs that serve the people of Ontario. Ontario’s program expense outlook is projected to grow from $194.5 billion in 2023–24 to $208.9 billion in 2026–27 for an average annual growth rate of 2.4 per cent. This also reflects additional compensation-related costs.

Table 3.8
Summary of Medium-Term Expense Outlook
($ Billions)
  Actual
2022–23
Interim1
2023–24
Medium-Term
Outlook
2024–25
Medium-Term
Outlook
2025–26
Medium-Term
Outlook
2026–27
Base Programs2 — Health Sector  75.1 84.5 85.0 88.0 89.9
Base Programs3 — Education Sector4  33.6 36.6 37.6 38.8 39.4
Base Programs5 — Postsecondary Education Sector  11.7 12.6 12.2 12.5 13.0
Base Programs6 — Children, Community and Social Services Sector  18.0 19.4 19.9 20.1 20.1
Base Programs7 — Justice Sector  5.3 6.1 5.9 5.6 5.6
Base Programs8 — Other Programs  30.1 35.3 40.0 40.9 40.9
Total Base Programs  173.8 194.5 200.6 205.8 208.9
COVID‑19 Time-Limited Funding 6.3
Other One-Time Expenses 6.3
Total Programs  186.4 194.5 200.6 205.8 208.9
Interest on Debt  12.4 12.8 13.9 14.7 15.2
Total Expense  198.8 207.3 214.5 220.6 224.1

Table 3.8 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

[2], [3], [5], [6], [7], [8] For presentation purposes in the 2024 Budget, one-time COVID-19-related spending in 2022–23 has been included within COVID-19 Time-Limited Funding. This funding is no longer reported separately, starting 2023–24.

[4] Excludes Teachers’ Pension Plan. Teachers’ Pension Plan expense is included in Other Programs.

Note: Numbers may not add due to rounding.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Highlights of the changes to the program expense outlook over the medium term include the following:

  • Health sector expense is projected to increase from $84.5 billion in 2023–24 to $89.9 billion in 2026–27. The growth is primarily due to investments to:
    • Address the growing demands in the health sector, including funding for hospitals and cancer treatment services to respond to Ontario’s aging and growing population;
    • Support health human resources initiatives to optimize the existing workforce and recruit and retain health care providers;
    • Improve and transform the home and community care sector;
    • Improve quality of care in the long-term care sector; and
    • Support mental health and addictions services through the Roadmap to Wellness: A Plan to Build Ontario’s Mental Health and Addictions System.
  • Education sector expense is projected to increase from $36.6 billion in 2023–24 to $39.4 billion in 2026–27. Key investments include:
    • Funding to address enrolment growth and support student achievement, including through Ontario’s back to basics learning strategy on reading and math;
    • Continued implementation of the Canada-wide Early Learning and Child Care Agreement to increase access to high-quality affordable child care while reducing average out-of-pocket child care fees; and
    • Supporting commitments consistent with labour agreements reached.
  • Postsecondary Education sector expense is projected to increase from $12.6 billion in 2023–24 to $13.0 billion in 2026–27. This is mainly due to:
    • Increased supports to institutions of $903 million to strengthen postsecondary education in Ontario, including implementing a Postsecondary Education Sustainability Fund to help address immediate financial sustainability challenges;
    • Investments of over $485 million to support Health Human Resources initiatives, including the ongoing expansion of nursing and medical school seats and the Ontario Learn and Stay Grant where students in targeted nursing, paramedic and medical laboratory technologist programs study and work in underserviced communities; and
    • Lower forecasted college sector spending, primarily as a result of the federal government announcement to cap international student study permit applications for two years, beginning in 2024.
  • Children, Community and Social Services sector expense is projected to increase from $19.4 billion in 2023–24 to $20.1 billion in 2026–27. This is mainly due to:
    • $310 million over three years to address increasing operational costs for community organizations that support vulnerable populations, including children in care and those with special needs, people with developmental disabilities, and people who have experienced gender-based violence and human trafficking; and
    • Annual inflation adjustments to core allowances for the Ontario Disability Support Program and the maximum monthly amount for the Assistance for Children with Severe Disabilities Program, which started in July 2023.
  • Justice sector expense is projected to decrease from $6.1 billion in 2023–24 to $5.6 billion in 2026–27. Investments in the sector include:
    • One-time funding in 2023–24 for compensation costs, including Bill 124 remedy settlements in the Justice sector;
    • Funding provided in 2023–24 to support essential service delivery in corrections, coroner and forensic pathology services,  as well as courts and animal welfare services; and
    • Continuing investments in the Justice sector to protect public safety such as the Guns, Gangs and Violence Reduction Strategy, air support equipment, initiatives to fight auto theft, and the expansion of the Basic Constable Training Program including the elimination of its tuition fees.
  • Other Programs expense is projected to increase from $35.3 billion in 2023–24 to $40.9 billion in 2026–27. Key changes include:
    • $3.3 billion over three years, beginning in 2024–25, as part of the government’s multi-year commitment to provide access to high-speed internet for every community across Ontario by the end of 2025;
    • $2.8 billion over three years, beginning in 2024–25, for strategic investments in industrial support and land development, including Ontario’s auto manufacturing sector and electric vehicle battery production;
    • $1.8 billion over three years, beginning in 2024–25, to help build municipal housing-enabling infrastructure projects through the $1.0 billion new Municipal Housing Infrastructure Program and the enhanced $825 million Housing-Enabling Water Systems Fund; and
    • $200 million over three years, beginning in 2024–25, for the new Community Sport and Recreation Infrastructure Fund to support new facilities and revitalize existing venues for youth and families, while creating good local jobs and supporting economic growth.

The total expense outlook includes Interest on Debt expense, which is projected to increase from $12.8 billion in 2023–24 to $15.2 billion in 2026–27.

Prudence Built into the Medium-Term Outlook

In keeping with sound fiscal planning practices, Ontario’s revenue outlook is based on prudent economic planning projections, as discussed in Chapter 2: Economic Performance and Outlook. Three external economic experts reviewed the Ontario Ministry of Finance’s economic assumptions and found them to be reasonable.1

The government maintains a responsible and flexible fiscal plan to respond to uncertainty and risks. Ontario incorporates prudence in the form of a reserve to protect the fiscal outlook against unforeseen adverse changes in Ontario’s revenue and expense, including those resulting from changes in Ontario’s economic performance.

In addition, the Contingency Fund is maintained to help mitigate expense risks that may adversely affect Ontario’s fiscal performance. The Contingency Fund in 2024–25 is set at $1.5 billion and increases further through the remainder of the medium‐term outlook, reflecting the government’s prudent and responsible fiscal planning.

The reserve has been set at $1.0 billion in 2024–25, $1.5 billion in 2025–26 and $2.0 billion in  2026–27. This reflects Ontario’s commitment to maintaining a prudent and flexible fiscal plan.

Risks to the Expense Outlook

Table 3.9 provides a summary of key expense risks and sensitivities that could result from unexpected changes in economic conditions and program demands. A change in these factors could affect total expense and the public sector, causing variances in the overall fiscal forecast. These sensitivities illustrate possible effects on the government’s key programs and can vary, depending on the nature and composition of potential risks.

Table 3.9
Selected Expense Sensitivities
Program/Sector 2024–25 Assumption 2024–25 Sensitivities
Hospital1 Annual growth of 4.0 per cent. One per cent change in hospital costs:
$249.3 million.
Home Care2 Approximately 39.8 million hours of personal support services.


Approximately 9.8 million nursing and therapy visits and 1.3 million nursing shifts.
One per cent change in hours of personal support services: approximately $19.5 million.

One per cent change in all nursing
and therapy visits: approximately $12.8 million.
Elementary and Secondary Schools Approximately 2.066 million
average daily pupil enrolment.
One per cent enrolment change: approximately $176 million.
Ontario Works 263,748 average annual caseload. One per cent caseload change: approximately $30 million.
Ontario Disability Support Program 376,462 average annual caseload. One per cent caseload change: approximately $63 million.
Interest on Debt Average cost of borrowing in 2024–25 is forecast to be 4.0 per cent. In the first full year, the impact of a 100 basis-point change in borrowing rates: approximately $700 million.

Table 3.9 footnotes:

[1] Hospital costs are based on hospital operating transfer payments and exclude one-time funding, consolidations and arbitrated wage settlements.

[2] Home Care statistics are based on a combination of 2022–23 and 2023–24 data and estimates.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Transparency and Risks

The government continues to be transparent about the state of Ontario’s finances. This principle is reflected in the Fiscal Sustainability, Transparency and Accountability Act, 2019, which stipulates that Ontario’s fiscal policy should be clearly articulated and information about it should be readily available to the public without charge.

To ensure a reasonable and prudent economic forecast, the government’s key economic planning projections are set below the average of private-sector forecasts in each year. While the planning assumptions for economic growth are reasonable and prudent, the Ontario Ministry of Finance has also developed Faster Growth and Slower Growth scenarios to provide greater transparency around a broader range of possible outcomes depending on the pace of Ontario’s economic growth amid heightened economic uncertainty.

As a matter of transparent fiscal management, financial pressures are monitored throughout the fiscal year with the goal of ensuring value for taxpayer dollars through the use of robust and prudent methodologies to develop forecasts. Other important risk management tools include closely tracking the pace of implementation of initiatives and proactively identifying emerging program and policy risks. Comprehensive analysis of known pressures informs the fiscal planning processes, including the development of plans to mitigate and manage fiscal pressures, as well as maintaining adequate contingencies as part of the medium-term fiscal projections. The fiscal plan also incorporates the impact of the Bill 124 court decision on compensation-related costs.

In addition to the key demand sensitivities and economic risks to the fiscal plan, there are risks stemming from the government’s contingent liabilities. Whether future events will result in actual liabilities for Ontario is beyond the direct control of the government. For example, losses could result from legal settlements, a call on a loan or funding guarantees. While a Contingency Fund is included in the fiscal plan to help mitigate expense risks, until there exists certainty around the likelihood and costs of these future events, these risks are not included in the government’s fiscal plan. Provisions for losses that are likely to occur and can be reasonably estimated are expensed and reported as liabilities in Ontario’s financial statements. Any significant contingent liabilities related to the 2023–24 fiscal year will be disclosed as part of the Public Accounts of Ontario 2023 –2024, to be released no later than September 27, 2024.

Details of Ontario’s Finances

Table 3.10
Total Revenue
($ Millions)
  Actual
2021–22
Actual
2022–23
Interim1
2023–24
Plan
2024–25
Taxation Revenue — Personal Income Tax 46,750 44,209 50,593 51,936
Taxation Revenue — Sales Taxes 30,357 36,092 39,762 38,832
Taxation Revenue — Corporations Tax 25,227 27,791 24,179 24,915
Taxation Revenue — Education Property Tax 5,713 5,991 5,755 5,831
Taxation Revenue — Employer Health Tax 7,223 7,797 8,364 8,720
Taxation Revenue — Ontario Health Premium 4,414 4,445 4,918 5,014
Taxation Revenue — Gasoline Tax 2,202 2,103 1,664 1,953
Taxation Revenue — Land Transfer Tax 5,827 4,443 3,739 3,881
Taxation Revenue — Tobacco Tax 927 864 827 771
Taxation Revenue — Fuel Tax 771 571 499 623
Taxation Revenue — Beer, Wine and Spirits Taxes 624 600 599 576
Taxation Revenue — Electricity Payments in Lieu of Taxes 666 674 535 536
Taxation Revenue — Ontario Portion of the Federal Cannabis Excise Duty 215 310 344 379
Taxation Revenue — Other Taxes 759 627 673 720
Taxation Revenue — Total 131,675 136,518 142,452 144,687
Government of Canada — Canada Health Transfer 16,731 17,525 19,277 20,256
Government of Canada — Canada Social Transfer 6,003 6,178 6,404 6,576
Government of Canada — Equalization –  421 576
Government of Canada — Infrastructure Programs 562 769 1,075 1,185
Government of Canada — Labour Market Programs 1,476 1,181 1,148 904
Government of Canada — Social Housing Agreement 305 263 218 174
Government of Canada — Other Federal Payments 5,091 4,817 5,739 6,098
Government of Canada — Direct Transfers to Broader Public Sector Organizations 439 530 481 482
Government of Canada — Total 30,607 31,264 34,764 36,252
Income from Government Business Enterprises — Liquor Control Board of Ontario 2,543 2,457 2,546 2,450
Income from Government Business Enterprises — Ontario Power Generation Inc./Hydro One Ltd.   2,151 850 1,973 1,314
Income from Government Business Enterprises — Ontario Lottery and Gaming Corporation 1,561 2,505 2,351 2,623
Income from Government Business Enterprises — Ontario Cannabis Store 186 234 242 225
Income from Government Business Enterprises — iGaming Ontario 87 162 174
Income from Government Business Enterprises — Total 6,441 6,133 7,274 6,786
Other Non-Tax Revenue — Fees, Donations and Other Revenues from Hospitals, School Boards and Colleges 9,688 11,492 11,737 10,239
Other Non-Tax Revenue — Vehicle and Driver Registration Fees2 33 1,251 1,190 1,181
Other Non-Tax Revenue — Miscellaneous Other Non-Tax Revenue 2,628 2,149 2,392 2,000
Other Non-Tax Revenue — Other Fees and Licences 1,237 1,438 1,698 1,657
Other Non-Tax Revenue — Sales and Rentals 1,046 1,227 1,388 1,546
Other Non-Tax Revenue — Reimbursements 1,233 1,031 1,112 1,002
Other Non-Tax Revenue — Royalties 468 335 289 295
Other Non-Tax Revenue — Power Supply Contract Recoveries   67 48 39 44
Other Non-Tax Revenue — Net Reduction of Power Purchase Contracts 5 – 
Other Non-Tax Revenue — Total 16,405 18,972 19,845 17,965
Total Revenue 185,128 192,887 204,336 205,690

Table 3.10 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

[2] Vehicle and Driver Registration Fees in 2021–22 reflect the elimination and rebate of eligible licence plate renewal fees paid since March 1, 2020.

Note: Numbers may not add due to rounding.

Source: Ontario Ministry of Finance.

Table 3.11
Total Expense1,2
($ Millions)
Ministry Expense Actual
2021–22
Actual
2022–23
Interim3
2023–24
Plan
2024–25
Agriculture, Food and Rural Affairs (Base) 284 300 352 378.2
Demand-Driven Risk Management and Time-Limited Programs 358 502 577 477.5
COVID-19 Time-Limited Funding4 32 30
Agriculture, Food and Rural Affairs (Total)   674 832 929 855.7
Attorney General (Base) 1,615 1,783 1,950 1,960.5
Statutory Appropriations — Crown Liability and Proceedings Act, 2019 49 79 36
Bad Debt Expense 7 30 25 5.3
Compensation Settlements 81
COVID-19 Time-Limited Funding5 145 31 –  
Attorney General (Total) 1,816 1,923 2,092 1,965.8
Board of Internal Economy (Base) 283 392 321 320.4
COVID-19 Time-Limited Funding6 2 0
Board of Internal Economy (Total) 284 392 321 320.4
Children, Community and Social Services (Base) 16,717 17,991 19,438 19,925.7
COVID-19 Time-Limited Funding7 293 48 –  
Children, Community and Social Services (Total) 17,010 18,039 19,438 19,925.7
Citizenship and Multiculturalism (Base) 33 54 70 70.7
Time-Limited Investments 21
COVID-19 Time-Limited Funding8 3 2
Citizenship and Multiculturalism (Total) 36 56 90 70.7
Colleges and Universities (Base)9 9,542 10,714 11,244 10,818.8
Student Financial Assistance 954 1,019 1,332 1,370.3
COVID-19 Time-Limited Funding10 117 32
Colleges and Universities (Total) 10,614 11,764 12,576 12,189.1
Economic Development, Job Creation and Trade (Base) 164 167 189 193.0
Tax Credits for Business Investment and Research and Development11 258 299 537 550.9
Tax Credits for Business Investment and Research and Development — Amounts Related to Prior Years  46 22 18
Time-Limited Investments 157 540 609 1,935.6
COVID-19 Time-Limited Funding12 360 46
Economic Development, Job Creation and Trade (Total) 985 1,074 1,352 2,679.5
Education (Base) 28,893 32,357 35,063 37,605.6
Teachers’ Pension Plan 1,610 1,661 1,653 1,700.0
Compensation Settlements 1,266 1,532
COVID-19 Time-Limited Funding13 1,060 918
Education (Total) 31,563 36,202 38,248 39,305.6
Energy (Base) 240 254 329 316.7
Electricity Cost-Relief Programs 6,313 5,844 6,120 7,336.1
COVID-19 Time-Limited Funding14 274 2
Energy (Total)   6,827 6,100 6,448 7,652.9
Environment, Conservation and Parks (Base) 687 727 835 860.4
One-Time Accounting Adjustment for Contaminated Sites 80
COVID-19 Time-Limited Funding15 16 17
Environment, Conservation and Parks (Total)   703 743 915 860.4
Executive Offices (Base) 49 55 68 66.8
COVID-19 Time-Limited Funding16 2 0
Executive Offices (Total) 51 55 68 66.8
Finance (Base) 759 799 906 969.3
Investment Management Corporation of Ontario17 210 245 296 312.7
Ontario Municipal Partnership Fund 502 501 502 501.9
Temporary and Other Local Assistance 21 21 68 41.0
Power Supply Contract Costs   67 48 39 43.7
Time-Limited Investments 174 119
COVID-19 Time-Limited Funding18 231 0
Finance (Total) 1,789 1,789 1,930 1,868.6
Francophone Affairs (Base) 7 7 8 8.6
Time-Limited Investments 1 4.7
COVID-19 Time-Limited Funding19 2
Francophone Affairs (Total) 9 8 8 13.3
Health (Base) 64,285 67,872 74,638 75,636.4
Compensation Settlements 970 2,080
Health (Total)20 64,285 68,842 76,717 75,636.4
COVID-19 Health Response21 6,167 3,331 –  
Indigenous Affairs (Base) 85 111 134 137.0
One-Time Investments Including Settlements 152 6,273 17
COVID-19 Time-Limited Funding22 4 1
Indigenous Affairs (Total) 241 6,384 151 137.0
Infrastructure (Base) 192 170 454 856.0
Federal–Provincial Infrastructure Programs 267 303 366 414.5
High-Speed Internet 75 328 316 1,376.9
Waterfront Toronto Revitalization (Port Lands Flood Protection) 156 25 25 30.2
Municipal Infrastructure Program Investments 399 396 393 672.1
Realty 1,174 1,195 1,198 1,340.8
COVID-19 Time-Limited Funding23 10
Infrastructure (Total) 2,272 2,416 2,753 4,690.5
Labour, Immigration, Training and Skills Development (Base) 102 202 248 256.1
Training Tax Credits (Co-operative Education and Apprenticeship Training)24 105 86 116 113.9
Demand-Driven Employment and Training Programs 1,016 1,269 1,294 1,268.3
Time-Limited Investments 13
COVID-19 Time-Limited Funding25 794 310 –  
Labour, Immigration, Training and Skills Development (Total) 2,017 1,866 1,670 1,638.3
Long-Term Care (Total)26 5,301 6,305 7,750 9,324.6
Mines (Base) 135 147 191 209.1
One-Time Accounting Adjustment for Contaminated Sites 183 86 334
Mines (Total) 318 233 525 209.1
Municipal Affairs and Housing (Base) 486 564 779 785.0
Time-Limited Investments 351 404 764 1,099.4
Social Housing Agreement — Payments to Service Managers27 281 206 194 168.8
COVID-19 Time-Limited Funding28 330 390 –   –  
Municipal Affairs and Housing (Total) 1,447 1,563 1,738 2,053.2
Natural Resources and Forestry (Base) 605 613 666 680.2
Emergency Forest Firefighting 237 95 216 135.0
Compensation Settlements 26
COVID-19 Time-Limited Funding29 12 2
Natural Resources and Forestry (Total) 855 710 907 815.1
Northern Development (Base) 605 661 719 762.3
COVID-19 Time-Limited Funding30 41
Northern Development (Total) 646 661 719 762.3
Public and Business Service Delivery (Base)31 613 963 1,131 743.0
COVID-19 Time-Limited Funding32 141 201
Public and Business Service Delivery (Total) 754 1,165 1,131 743.0
Seniors and Accessibility (Base) 53 63 65 66.3
Seniors Tax Credits (Home Safety and Care at Home) 30 164 108 119.4
COVID-19 Time-Limited Funding33 43 11
Seniors and Accessibility (Total) 127 237 173 185.6
Solicitor General (Base) 2,981 3,375 3,765 3,912.6
Compensation Settlements 233
COVID-19 Time-Limited Funding34 150 96
Solicitor General (Total) 3,131 3,472 3,998 3,912.6
Tourism, Culture and Sport (Base) 833 829 840 870.2
Time-Limited Investments 50.0
Ontario Cultural Media Tax Credits 693 833 841 1,034.4
Ontario Cultural Media Tax Credits — Amounts Related to Prior Years 84 51 89
COVID-19 Time-Limited Funding35 257 200
Tourism, Culture and Sport (Total) 1,868 1,913 1,770 1,954.7
Transportation (Base) 4,854 5,547 6,388 6,390.4
Federal–Provincial Infrastructure Programs 557 477 743 708.4
Time-Limited Investments 729
Compensation Settlements 25
COVID-19 Time-Limited Funding36 369 609
Transportation (Total) 5,780 6,633 7,885 7,098.7
Treasury Board Secretariat (Base)37 315 476 633 918.1
Employee and Pensioner Benefits 2,633 1,178 1,035 1,223.5
Operating Contingency Fund 500 1,405.4
Capital Contingency Fund 100.0
COVID-19 Time-Limited Funding38 2 0 –  
Treasury Board Secretariat (Total) 2,950 1,654 2,168 3,647.0
Interest on Debt39 12,583 12,389 12,843 13,913.0
Total Expense 183,103 198,750 207,313 214,495.9

Table 3.11 footnotes:

[1] Numbers reflect current ministry structure.

[2] Ministry expenses have been restated for reclassification and program transfer changes. These changes are fiscally neutral. The actual results are presented on a similar basis for consistency.

[3] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

[4], [5], [6], [7], [8], [10], [12], [13], [14], [15], [16], [18], [19], [22], [23], [25], [28], [29], [30], [31], [32], [33], [34], [35], [36], [37], [39] COVID‐19 Time‐Limited Funding is no longer reported separately, starting in 2023–24.

[9] Projected to decline from 2023–24 to 2024–25 primarily due to lower college spending as a result of the federal government announcement to cap international student study permit applications for two years, beginning in 2024.

[11] Includes the estimated cost of tax credit claims for the Regional Opportunities Investment Tax Credit, the Ontario Made Manufacturing Investment Tax Credit (OMMITC), the Ontario Innovation Tax Credit and the Ontario Business-Research Institute Tax Credit. The OMMITC was introduced in the 2023 Budget with costs commencing in 2023–24.

[17] Based on the requirements of Public Sector Accounting Standards, the Ontario government consolidates the financial results of the Investment Management Corporation of Ontario.

[20] Includes accounting adjustments tied primarily to grants provided for infrastructure projects and other related investments.

[21] For presentation purposes in the 2024 Budget, Time-Limited COVID-19-related health response spending has been included separately for 2021–22 to 2022–23 instead of within the Ontario Ministry of Health and Ontario Ministry of Long-Term Care.

[24] The Co-operative Education Tax Credit remains in effect. The Apprenticeship Training Tax Credit is eliminated for eligible apprenticeship programs that commenced on or after November 15, 2017. Amounts from 2021–22 to 2023–24 include tax credit amounts related to prior years; however, a decrease in costs of $18 million for the Apprenticeship Training Tax Credit in 2022–23 was reported separately as revenue.

[26] The Ontario Ministry of Long-Term Care total includes expenses incurred by Ontario Health and hospitals for funding for long-term care. These amounts will be consolidated in the total expense of the Ontario Ministry of Health, including $4.4 billion for interim 2023–24 and $5.2 billion in 2024–25.

[27] The annual decline from 2021–22 to 2023–24 is mainly due to declining federal obligations, such as maturing mortgages, under the Social Housing Agreement.

[37] Funding for Supply Ontario will transfer from the Ministry of Public and Business Service Delivery to Treasury Board Secretariat as of April 1, 2024, to reflect ministerial responsibility for oversight of the provincial agency.

[38] Interest on debt is net of interest capitalized during construction of tangible capital assets of $321 million in 2021–22, $694 million in 2022–23, $573 million in 2023–24 and $865 million in 2024–25.

Note: Numbers may not add due to rounding.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Chart 3.4: Composition of Total Revenue, 2024–25
Accessible description of Chart 3.4
Chart 3.5: Composition of Total Expense, 2024–25
Accessible description of Chart 3.5
Table 3.12
Infrastructure Expenditures
($ Millions)
Sector Total
Infrastructure Expenditures
Interim1,2
2023–24
2024–25 Plan
Investment
in Capital Assets3
2024–25 Plan
Transfers
and Other Infrastructure Expenditures4
2024–25 Plan
Total
Infrastructure Expenditures
Transportation — Transit 8,638 9,535 1,160 10,695
Transportation — Provincial Highways 3,285 3,649 222 3,872
Transportation — Other Transportation, Property and Planning 188 137 81 218
Health — Hospitals 3,348 3,545 37 3,582
Health — Other Health 640 47 255 303
Education 3,316 3,127 223 3,350
Postsecondary Education — Colleges and Other 765 792 87 879
Postsecondary Education — Universities 113 130 130
Social 435 26 949 975
Justice 514 860 48 908
Other Sectors5 2,874 1,089 3,219 4,307
Total Infrastructure Expenditures 24,117 22,808 6,412 29,220
Less: Other Partner Funding6 3,176 2,972 2,972
Total7 20,941 19,836 6,412 26,248

Table 3.12 footnotes:

[1] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

[2] Includes provincial investment in capital assets of $14.7 billion.

[3] Includes $865 million in interest capitalized during construction.

[4] Includes transfers to municipalities, universities and non-consolidated agencies.

[5] Includes high-speed internet infrastructure, government administration, natural resources, and culture and tourism industries.

[6] Other Partner Funding refers to third-party investments primarily in hospitals, colleges and schools.

[7] Includes Federal–Municipal contributions to provincial infrastructure investments.

Note: Numbers may not add due to rounding.

Source: Ontario Treasury Board Secretariat.

Table 3.13
10-Year Review of Selected Financial and Economic Statistics1,
($ Millions)
  2015–16 2016–17 2017–18 2018–19 2019–20 2020–21 2021–22 Actual
2022–23
 Interim4
2023–24
Plan
2024–25
Revenue 136,148 140,734 150,696 153,804 156,167 164,970 185,128 192,887 204,336 205,690
Expense — Programs 129,905 131,442 142,464 148,747 152,265 168,964 170,520 186,361 194,470 200,583
Expense — Interest on Debt2 11,589 11,727 11,912 12,385 12,497 12,296 12,583 12,389 12,843 13,913
Total Expense 141,494 143,169 154,375 161,132 164,762 181,260 183,103 198,750 207,313 214,496
Reserve 1,000
Surplus/(Deficit) (5,346) (2,435) (3,679) (7,328) (8,595) (16,290) 2,025 (5,863) (2,977) (9,806)
Net Debt 306,357 314,077 323,068 337,623 352,382 372,501 382,842 400,484 414,814 439,056
Accumulated Deficit 203,014 205,939 208,257 215,770 224,814 238,231 238,160 246,804 249,781 259,587
Gross Domestic Product (GDP) at Market Prices 760,435 790,749 824,979 860,103 893,224 874,354 960,226 1,048,258 1,091,497 1,120,967
Primary Household Income 512,570 520,486 541,501 567,484 593,065 592,514 642,859 695,228 739,268 768,844
Population (000s) — July3 13,709 13,877 14,078 14,327 14,574 14,762 14,842 15,145 15,608 16,021
Net Debt per Capita (Dollars) 22,347 22,634 22,948 23,566 24,180 25,234 25,794 26,443 26,576 27,405
Household Income per Capita (Dollars) 37,389 37,508 38,463 39,610 40,695 40,138 43,312 45,905 47,364 47,990
Net Debt as a Per Cent of Revenue 225.0% 223.2% 214.4% 219.5% 225.6% 225.8% 206.8% 207.6% 203.0% 213.5%
Interest on Debt as a Per Cent of Revenue 8.5% 8.3% 7.9% 8.1% 8.0% 7.5% 6.8% 6.4% 6.3% 6.8%
Net Debt as a Per Cent of GDP 40.3% 39.7% 39.2% 39.3% 39.5% 42.6% 39.9% 38.2% 38.0% 39.2%
Accumulated Deficit as a Per Cent of GDP 26.7% 26.0% 25.2% 25.1% 25.2% 27.2% 24.8% 23.5% 22.9% 23.2%

Table 3.13 footnotes:

[1] Amounts reflect a change in pension expense that was calculated based on recommendations of the Independent Financial Commission of Inquiry, as described in Note 19 to the Consolidated Financial Statements, in Public Accounts of Ontario 2017–2018. Amounts for net debt and accumulated deficit also reflect this change.

[2] Interest on debt is net of interest capitalized during construction of tangible capital assets of $321 million in 2021–22, $694 million in 2022–23, $573 million in 2023–24 and $865 million in 2024–25.

[3] Population figures are for July 1 of the fiscal year indicated (i.e., for 2023–24, the population on July 1, 2023, is shown).

[4] Interim represents the 2024 Budget projection for the 2023–24 fiscal year.

Note: Numbers may not add due to rounding.

Sources: Statistics Canada, Ontario Treasury Board Secretariat, and Ontario Ministry of Finance.

Footnotes

[1] The three experts are from the Policy and Economic Analysis Program at the University of Toronto; Quantitative Economic Decisions, Inc. (QEDinc.); and Stokes Economics Consulting, Inc.

Chart Descriptions

Chart 3.1: Current Fiscal Outlook Compared to the 2023 Budget and 2023 Ontario Economic Outlook and Fiscal Review

The bar chart illustrates the fiscal outlooks presented in the 2023 Budget and the 2023 Ontario Economic Outlook and Fiscal Review compared to the current outlook in the 2024 Budget. The 2023 Budget projected a deficit of $1.3 billion in 2023–24 and surpluses of $0.2 billion in 2024–25 and $4.4 billion in 2025–26. The 2023 Ontario Economic Outlook and Fiscal Review projected deficits of $5.6 billion in 2023–24 and $5.3 billion in 2024–25, and a surplus of $0.5 billion in 2025–26. With the release of the 2024 Budget, the deficit projections have been revised to deficits of $3.0 billion in 2023–24, $9.8 billion in 2024–25 and $4.6 billion in 2025–26, and a surplus of $0.5 billion in 2026–27.

Source: Ontario Ministry of Finance.

Return to Chart 3.1

Chart 3.2: Sources of Revenue Changes Since the 2023 Budget

The multi-year chart identifies the sources of revenue changes since the 2023 Budget for each year of the medium-term outlook. In 2023–24, total revenues are projected to be slightly lower than the 2023 Budget. The overall decline is due to decreases in revenue of $1.5 billion caused by updated economic and federal tax information, $0.1 billion in Federal Transfers and $0.1 billion in Other Revenue changes1, partially offset by increases of $0.9 billion in Government Business Enterprises and $0.7 billion in College sector revenues.

In 2024–25, total revenues are projected to be $7.3 billion lower than the 2023 Budget. The overall decline is due to decreases in revenue of $0.8 billion in other revenue changes, $1.4 billion in College sector revenues and $6.5 billion caused by updated economic and federal tax information, partially offset by increases of $1.2 billion in Federal Transfers and $0.1 billion in Government Business Enterprises.

In 2025–26, total revenues are projected to be $8.5 billion lower than the 2023 Budget. The overall decline is due to decreases in revenue of $1.7 billion in College sector revenues, $0.5 billion in Government Business Enterprises and $6.9 billion caused by updated economics and federal tax information, partially offset by increases of $0.4 billion in Federal Transfers and $0.1 billion in other revenue changes.

[1] Other Revenue Changes mainly reflect the impact of extending the gasoline and fuel tax cut, changes in other Non-Tax Revenues excluding Broader Public Sector Colleges, Cannabis Tax, Education Property Tax, Electricity Payments-in-Lieu of Taxes and other miscellaneous taxes.

Source: Ontario Ministry of Finance.

Return to Chart 3.2

Chart 3.3: Ontario Fiscal Outlook Scenarios

The bar chart illustrates the range of Ontario fiscal outlooks based on the two alternative economic scenarios presented in Chapter 2: Economic Performance and Outlook. The 2024 Budget outlook estimates the deficit to be $9.8 billion in 2024–25 and $4.6 billion in 2025–26, followed by a surplus of $0.5 billion in 2026–27. Under the Faster Growth scenario, the deficit outlook is estimated to be $6.1 billion in 2024–25, followed by surpluses of $2.0 billion in 2025–26 and $9.7 billion in 2026–27. Under the Slower Growth scenario, the deficit outlook is estimated to be $13.3 billion in 2024–25, $10.4 billion in 2025–26 and $7.5 billion in 2026–27.

Source: Ontario Ministry of Finance.

Return to Chart 3.3

Chart 3.4: Composition of Total Revenue, 2024–25

The pie chart shows the composition of Ontario’s revenue in 2024–25, which is projected to be $205.7 billion. The largest taxation revenue source is Personal Income Tax revenue at $51.9 billion, accounting for 25.2 per cent of total revenue. This is followed by Sales Tax at $38.8 billion, or 18.9 per cent of total revenue; and Corporations Tax at $24.9 billion, or 12.1 per cent of total revenue. Other components of taxation revenue include Education Property Tax at $5.8 billion, or 2.8 per cent of total revenue; Employer Health Tax at $8.7 billion, or 4.2 per cent; Gasoline Tax and Fuel Taxes at $2.6 billion, or 1.3 per cent; the Ontario Health Premium at $5.0 billion, or 2.4 per cent; and Other Taxes at $6.9 billion, or 3.3 per cent of total revenue.

Total taxation revenue accounts for $144.7 billion, or 70.3 per cent of total revenue.

The other major non-taxation sources of revenue are Federal Transfers of $36.3 billion, or 17.6 per cent of total revenue; Income from Government Business Enterprises at $6.8 billion, or 3.3 per cent of total revenue; and various Other Non-Tax Revenue at $18.0 billion, or 8.7 per cent of total revenue.

Note: Numbers may not add due to rounding.

Source: Ontario Ministry of Finance.

Return to Chart 3.4

Chart 3.5: Composition of Total Expense, 2024–25

The pie chart shows the share of Ontario’s total expense and dollar amounts by sector in 2024–25.

Total expense in 2024–25 is projected to be $214.5 billion.

The largest expense is the Health sector at $85.0 billion, accounting for 39.6 per cent of total expense.

The remaining sectors of total expense include the Education sector1 at $37.6 billion or 17.5 per cent; the Postsecondary Education sector at $12.2 billion or 5.7 per cent; the Children, Community and Social Services sector at $19.9 billion or 9.3 per cent; the Justice Sector at $5.9 billion or 2.7 per cent; Other Programs at $40.0 billion or 18.7 per cent; and Interest on Debt, included as part of Total Expense, is $13.9 billion or 6.5 per cent.

[1] Excludes Teachers’ Pension Plan. Teachers’ Pension Plan expense is included in Other Programs.

Note: Numbers may not add due to rounding.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Return to Chart 3.5

Updated: March 26, 2024
Published: March 26, 2024