Driving Naari Programme launched in Chandigarh
Ontario, The new social spending contained in Kathleen Wynne’s pre-election budget will be paid for by nearly $20 billion in new borrowing over the next three years and a quietly introduced personal income tax increase affecting almost two million Ontarians.
The 2018 budget indicates the deficit is projected to be $6.7 billion, and combined deficits for the next three years amount to $19.8 billion.
The borrowing will pay for free childcare for preschool-age kids, free drugs for seniors, the largest investment in mental health care ever and a new basic dental and drug plan for those without workplace benefits.
“We have a choice to make, there are people in this province, people who are saying they still need more support. mental health, hospitals, childcare – when you look at families without benefits they’re looking for supports too. And so we’ve decided to support them,” Finance Minister Charles Sousa told reporters at the budget lockup on Wednesday afternoon.
He dismissed concerns from reporters that his plan sends the province back into deficit for at least the next six years, saying deficits are normal.
“In the last 40 years there’s been eight balanced budgets. The PC’s did three. I have done one and we have had some others in our mandate.”
PC leader Doug Ford said the final budget document of Premier Kathleen Wynne’s first majority mandate is a sign of her desperation.
“(Wynne) will do anything, promise anything to cling to power. She’s writing big cheques with your money,” Ford said.
He took particular umbrage with the Liberals’ commitment to make preschool free for toddlers by 2020.
“It’s amazing how they pledge billions of dollars for children who haven’t even been born. I’m surprised the finance minister isn’t up here promising free cars, you get a car, and you get a car, or that we’ll pay your mortgage,” he said.
Sousa contended that the new spending had nothing to do with the election that is two months away and more to do with what he and other Liberal ministers were hearing from the public.
“(We) balanced the budget (last year) and we had a surplus and now we had a choice. Not everyone in the province is feeling that prosperity.”
When asked, Ford would not say which of the Liberals’ pledges he would cut, nor would he promise to balance the budget in his first year if elected.
“I have a track record of doing what we say we’re going to do. So when we have our budget out, we’ll make sure we’ll be helping families with daycare, helping the healthcare industry.”
NDP leader Andrea Horwath took aim at Ford’s responses.
“Mr. Ford has a lot of sound bytes, a lot of platitudes, maybe that’s because he printed a lot of bumper stickers in his other life,” Horwath said, referring to Ford’s label-making business.
Aside from borrowing, the province will rely on cannabis sales coming on stream and personal income tax reform to help pay for all of its new committments.
The Liberals are removing the surtaxes imposed on middle and high income tax filers and replacing them with revised income brackets.
As a result, those making $92,000 or less will see a nominal difference or will actually pay up to $130 less, while those making $92,000 or more will pay more. A tax filer making $95,000 gross will pay $168 more in personal income tax next year.
The tax bracket change will bring in $275 million this year, $285 million in 2019-2020 and $295 million in 2020-2021.
The province says 83 per cent of tax filers will pay the same or less with this move. About 1.8 million tax filers would pay more due to the surtax elimination, an average of $200 more each per year.
Revenues from pot stores set up throughout the province in 2018 are expected to be $35 million in 2019, and $100 million in 2020-2021.
In addition, the feds will send Ontario $35 million of pot excise tax revenue in 2018-2019, $80 million in 2019-2020. and $115 million in 2020-2021.
Ontario spent $8 million to set up Ontario Cannabis Stores in 2017, and will spend another $40 million in 2018.
The budget introduces a new program offering seniors ages 75 and over who live in their own homes up to $750 per year for maintenance. There is also $822 million more made available for the province’s hospitals, which the Liberals say is the largest government cash injection in nearly a decade.
Finally, the budget includes $2.1 billion over the next four years to expand available care for those seeking mental health assistance, bringing the total investment $17 billion over 4 years.
Goods for Toronto
This year’s budget is relatively short on measures that specifically target Toronto.
The province says it is ready to begin discussions with the city about possibly uploading the costs of operating subways. An official speaking on background said there is no timeline for when talks would begin but the province wants to discuss the costs of maintaining subway service.
Ford said he wholeheartedly supports uploading subways to the province, a notion first brought forward by former Ontario PC leader Patrick Brown.
“I am fully committed on making sure that we take care of uploading the subway system and building proper rapid transit,” Ford said.
Also in the transit file, the province will make all GO Transit trips within Toronto will cost $3. As well, GO Transit trips of 10 kilometres or less will also cost $3 for PRESTO card users. The Ministry of Transportation says the discount will take effect sometime in early 2019.
The province also want to push negotiations between the TTC and other transit authorities in the 905 to offer a discount to commuters of about $1.50 a trip.
The province has also for the first time, included some costs of construction for a first-in-Canada high-speed rail line linking Toronto to Windsor. The province has allocated $11 billion over the next ten years for the design and construction of the line, which Wynne promised during the last general election.
Basic dental and drug plan
Sousa also outlined a new basic drug and dental program for working-age adults who would not otherwise have benefits.
The Ontario Drug and Dental Program will cover 80 per cent of drug and dental costs, up to $400 per year for single people, $600 per year for couples and $700 per year for families with kids.
Horwath excoriated the Liberals for that commitment, saying their plan fell far short of her plan for universal coverage.
“They are leaving people out on every measure, I do not support any of the programs in this budget. This is a very meagre effort to get votes,” she said.
She criticized the low annual allowances in the Liberal plan, saying they wouldn’t even cover a few children’s cavities each year.
“The finance minister said it himself, one in two people will be able to get prescription drugs. Well we think two in two people should be able to get drug coverage.”
Debt soars
Ontario’s net debt is projected to climb to $360.1 billion by 2020-2021.
Sousa defended the borrowing, saying investors across the world continue to gobble up our debt.
“Ontario continues to be highly sought after, our paper is still highly liquid. This fiscal plan is something (global investors) appreciate.”
