Ontario Premier Doug Ford is banking on billions of dollars in infrastructure spending to get him re-elected to a second term in office, relying on continued deficits to fuel campaign promises.
The Ford government tabled “Ontario’s Plan to Build” on Thursday, a 241-page, $198 billion document that serves both as a provincial budget and an election platform for the PC party.
With the PCs enjoying a lead in public polling ahead of the June 2 election, the budget provided few surprises that weren’t pre-announced by Ford’s cabinet and the premier himself in recent weeks.
It also painted an optimistic picture of Ontario’s economic outlook – projecting tax revenue to steadily increase, program spending to increase even more, and the province’s books to slowly get back to balance after significant COVID-driven deficits.
And if there was any doubt that the PCs were using the budget as an unofficial launch of the provincial campaign, Finance Minister Peter Bethlenfalvy put them to rest in a budget speech peppered with attacks against the opposition Liberals.
“While every party today is paying lip-service to the rising cost of living, it’s important to check the track record. Over 15 long years in office, the previous Liberal government said ‘no’ to giving families a break,” said Finance Minister Peter Bethlenfalvy, in his prepared budget speech.
“We’re saying ‘yes’ to helping Ontario families with the cost of living. Including when we struck the best childcare deal of any province in Canada,” Bethlenfalvy added, referring to the recent deal reached between Doug Ford’s government and Justin Trudeau’s federal Liberals.
While the Progressive Conservatives intend to run on this budget, it’s unclear whether the same exact document tabled today will be reintroduced in the event of their reelection.
Bethlenfalvy repeatedly evaded questions from several reporters about whether the document could be altered after the June election. After being pressed for answers, Bethlenfalvy eventually conceded some aspects were subject to change depending on the course of the upcoming campaign.
“We’re going to go through an election, we’re going to listen to the people of Ontario,” he said.
“This is our plan that we’ve tabled, this is our plan to rebuild the economy, and this is our plan to get those good jobs.”
That led to concerns among opposition critics about a potential “bait and switch” budget.
“There must be a hidden budget somewhere, because the Finance Minister refused to commit to the document that he put in front of everybody today,” said NDP Leader Andrea Horwath.
Without a guaranteed re-tabling of the budget, the fiscal document could never see the light of day in its current iteration.
Horwath told reporters she wouldn’t re-introduce the same budget document if she were elected to the Premier’s Office and Ontario Liberal Leader Steven Del Duca indicated he would scrap large portions of the fiscal plan.
The Premier’s Office later clarified that the PC party will re-introduce an identical budget document this year, if the party is re-elected.
Budget focused on growth
The budget is being framed by the Ontario PCs as a “growth” strategy – investing in things like highway infrastructure and “rebuilding” the economy after COVID-19, while keeping program spending increasing at a steady clip.
But the budget’s own assumptions predict real GDP growth to decline after a post-COVID bump – from 4.3 per cent in 2021 to 1.9 per cent in 2025.
“Private‐sector forecasters, on average, are projecting Ontario’s real GDP to grow by 4.1 per cent in 2022, 3.2 per cent in 2023, 2.1 per cent in 2024, and 2.0 per cent in 2025. The Ontario Ministry of Finance’s real GDP projections are set below the average of private‐sector forecasts in each year for prudent planning purposes,” the budget document noted.
The Ford government is projected to continue running deficits for the next five years, declining from a projected $19.9 billion deficit in 2022-23 to a $2.2 billion surplus in 2027-28.
But it also makes clear that, should Ontario’s economy grow faster than the government expects, the provincial government could balance the budget as early as two years from now.
The government’s estimates are at odds with the independent Financial Accountability Office, which earlier this month – and before the new budget measures – predicted the Ontario government could balance the budget in 2023 and run a $7.1 billion surplus in 2026-27.
Of course, the numbers and forecasts are contingent on Ford’s government being re-elected in June.
And to that end, the fiscal plan proposes some crowd-pleasing investments and few surprises after a pre-budget announcement blitz by Ford and his cabinet, including:
-$25.1 billion over the next decade on highway construction, expansion and “rehabilitation” projects.
-$61.6 billion over the same time period for public transit projects, including “breaking ground” on the Ontario Line project in Toronto.
-$40 billion over 10 years for hospital infrastructure in the province, and
-$21 billion over 10 years for the “renewal and expansion” of schools and child care infrastructure.
Despite pocketbook issues preoccupying politicians of every stripe, a recent Ipsos poll for Global News suggested health care and address COVID-19 were the top two issues Ontarians said would determine their vote.
Of the 1,001 voting-aged Ontarians surveyed by Ipsos between April 13 and 14, a total of 31 per cent cited health care as one of their top-three ballot issues, while 25 per cent said the same of the handling of the COVID-19 pandemic.
Affordability issues – lowering taxes (24 per cent), help with the cost of day-to-day needs (22 per cent) and making housing more affordable (21 per cent) – rounded out the top-five ballot box questions. The Ipsos poll is considered accurate within 3.5 percentage points, 19 times out of 20.
While the Ipsos poll gave the edge to the opposition Liberals and NDP on issues like healthcare and the environment, Ford’s Tories dominated the pocketbook issues.