Premier Doug Ford announced Monday the provincial government has cancelled retroactive funding cuts to municipalities.
Ford, along with Minister of Municipal Affairs and Housing Steve Clark, made the announcement at Queen’s Park just after 10 a.m.
The Tories are tackling an $11.7-billion deficit and had announced a host of funding cuts to municipalities, including for public health, child care and ambulance services.
Ford said he heard from municipalities that they could find savings in their own budgets, but they needed more time to do so.
“We’ve come up with a conclusion that we’re going to work together,” he said Monday. “We’re going to maintain the funding throughout this year. Every mayor I talked to said they can find savings. So that’s good news. But they said they needed more runway.”
The province notified municipal public health units in phone calls that it will reduce its cost-sharing levels from 100 per cent or 75 per cent in some cases, to 60 to 70 per cent for some municipalities, and 50 per cent for Toronto. The move, the government said, will save the province $200 million a year by 2021-22.
The province also budgeted $93 million less this year on child-care capital spending.
The government also announced that it would be cancelling an increase to municipalities’ share of gas tax funding. When the former Liberal party was in power, it announced it was doubling municipalities’ share from two cents to four, it was estimated that would mean $642 million in 2021-22. Last year they received $364 million.
The cuts combined with the cancellation of an increase to municipalities’ share of the gas tax mean local governments would be out well over half a billion dollars annually.
Municipalities had been pushing back hard against the funding cuts, which were announced after they already passed this year’s budgets.
Toronto Mayor John Tory was leading the charge through news conferences, starting a petition and urging residents to sign, door knocking, and creating a sticker parodying the province’s anti-carbon tax stickers for gas pumps.
Tory issued a statement shortly after the announcement and thanked all involved in the “efforts to oppose these cuts,” as well as Ford and Clark.
“As I have said before, I recognize and appreciate the challenges the Government of Ontario faces getting its budget deficit under control, and I support its intention to do so. However, this must be done in a prudent, collaborative manner that does not impact the vital services that people in Toronto rely on each and every day. This can only be done if we work together,” he said.
“I am hopeful this process will be truly collaborative, and that we will have the time to identify a reasonable number of efficiencies that can be achieved, without having to make cuts to important services.”
WATCH: Ford says cancelling cuts to municipalities isn’t sign he’ll reverse course on issues
The City of Toronto alone estimated the Ford government cuts would cost it $178 million this year. City manager Chris Murray recently told city council the cuts could not be made up for through efficiencies, as Ford had suggested. Instead, Murray said the city would have to look at raising property taxes or cutting services.
Toronto Coun. Joe Cressy, also chair of the board of health, said Ford did the “right thing” in reversing the active cuts to public health and childcare but that questions still remain.
“Is the province still committed to cutting $935 million from Toronto Public Health, and reducing the provincial cost-sharing formula for public health units across Ontario starting next year? Or, are they willing to work with municipalities to review this policy going forward?” Cressy said in a statement.
“An indisputable body of evidence and a chorus of critics from across the province and political spectrum clearly demonstrates that cutting public health is both harmful and fiscally irresponsible. In order to build a healthy and prosperous province, governments must invest in public health, not cut it.”
Ford denied the change in course was due to a fall the Tories are experiencing in the polls. Recent numbers show the Progressive Conservatives, the Ontario Liberals and NDP are locked in a three-way tie, according to an exclusive Ipsos poll released Friday.
WATCH: Clark, Ford defends initial retroactive cuts to municipal services
Ford announced last week $7.35 million in provincial funding to large municipalities and school boards to come up with four cents of savings for each dollar spent.
—With files from The Canadian Press