Thursday, the Ontario Liberal government put forward the first balanced budget in the last decade.
“This budget is fiscally responsible,” Ontario Minister of Finance Charles Sousa said to reporters in budget lockup, prior to the Throne Speech. “Balancing the budget allows us to make these important investments — investments that have real meaningful impacts in people’s lives.”
The 2017 Ontario Budget, entitled A Stronger, Healthier Ontario, is meant to spearhead a balanced budget for the next three years. The document focuses greatly on health care and education, while investing less in infrastructure and transit. There are some special tidbits for families, including a 35 per cent reduction on hydro bills for eligible households, free prescription medication for children and young adults, and funding for work-related opportunities through a new Career Kick-Start Strategy.
Sousa was adamant the budget did not have anything to do with the impending provincial election.
“Our message for the people of Ontario is that we, together, have balanced the budget, have taken the precautions of assumed growth, and now we are taking the necessary steps moving forward,” he said. “We want to be competitive long term. These decisions we make today are not based on election times. They are based on long-term benefit for the people of Ontario.”
It’s important to note that despite the balanced budget, there still exists a projected total debt of $332.4 billion as of March 31, 2017.
Here are some of the highlights from the 2017 provincial budget:
Health care
The biggest announcements in the 2017 Ontario Budget was the Child and Youth Pharmacare benefit program, which will provide free prescription medications for everyone ages 24 and under — also called OHIP Plus. The coverage includes rare disease medications, cancer drugs, medication for diabetes, asthma, mental health, HIV, and birth control. The new OHIP program will be effective as of Jan. 1, 2018.
The cost of this program, which was left out of the budgetary documents and press releases, is $465 million annually.
Ontario will also expand access to safe abortion by providing publicly funding the new abortion pill Mifegymiso.
Other investments include:
- $9 billion over 10 years to support construction of new “hospital projects” across the province
- $518 million to provide a three per cent to help decrease wait times and maintain elective surgeries, among other hospital services.
- $15 million for primary care and OHIP-funded non-physician specialized health services
- $74 million over three years for mental health services, including supportive housing units and structures psychotherapy
Transportation
The provincial government, while making significant investments in health care and education, chose to maintain investments on pre-existing projects rather then provide new funding for further transit networks like the downtown relief line.
In addition to the province’s continual $190 billion investment over a 13-year period, which started in 2014, Ontario is investing an additional $56 billion in public transportation for the GO Network and other pre-existing infrastructure projects like the Eglinton Crosstown, Hamilton Rapid Transit, and the Mississauga Transitway.
The budget indicates the province will continue to “support for the planning of the Downtown Relief Line in Toronto”, but no further funding was made available. Currently, Ontario has offered $150 million for the planning of this integral transit project.
Instead, the province is standing firm in their contributions via the gas tax program, which promises to double the municipal shares from two to four cents per litre by 2021.
Other transit projects receiving funding include:
- $1 billion for the second stage of the Ottawa LRT
- $43 million for proposed transit hub in downtown Kitchener, which will connect to GO and Via Rail.
Housing
The province introduced their Fair Housing Plan, which is meant to help increase affordability for buyers and renters. The cost of housing has increased up to 33.2 per cent since 2016. Ontario has proposed a non-resident speculation tax to help cool the market. This will be a 15 per cent tax on the price of homes for non-Canadians, non-permanent residents, and foreign corporations. If passed, this tax would be effective as of April 21, 2017. Ontario has also committed to improving rent control in Ontario to include units occupied on or after Nov. 1, 1991.
Toronto Mayor John Tory may not have been given the right to toll the DVP and Gardiner Expressway, but the provincial government has permitted the city to implement a levy on “transient accommodations”. This will allow Toronto to tax hotels and short-term accommodations in order to generate much-needed revenue for infrastructure in the city.
The authority to implement such a tax will also be extended to all “single-tier and lower-tier municipalities”, with the understanding that 50 per cent of the funds accumulated from the levy be given to the municipality’s regional tourism organization.
An amendment to the City of Toronto Act will have to be approved before such a levy becomes a reality.
Other investments include:
- $200 million over three years to improve access for up to 6,000 families and individuals to housing assistance and services
- $125 million over five years for multi-residential rebates to help encourage development
- $70-100 million for a pilot project throughout GTHA to leverage land assets to build affordable housing
- Proposed amendment of legislation that would grant Toronto authority to add a levy to property tax on vacant homes.
- Frozen municipal property taxes for multi-residential properties where taxes are high
Child Care
Ontario will support an access to licensed childcare for an additional 24,000 children ages four and under. The $200 million in funding allotted to this project for 2017-18 includes a mix of subsidies and the creation of physical spaces for childcare.
In fall of 2016, Ontario spent $65.5 million to create 3,400 licensed childcare spaces.
Climate Change
This year’s budget didn’t put as much of an emphasis on the province’s environmental efforts. Through the cap and trade program, the government has accumulated $472 million in funding that must be re-invested into programs that will reduce greenhouse gas emissions. This specific funding was from Ontario’s first carbon auction in March.
Through these auctions, Ontario expects to raise $1.8 billion in 2017-18 and then $1.4 billion annually following that year. Examples of where this money can be spent include promoting electric vehicles, modernizing transit, preserving lands, enhancing research, and Green Investment Fund initiatives.
Other investments include:
- $377 million through the Green Ontario Fund to make it easier for households and businesses to adopt proven low-carbon technologies.
- $200 million in funding for schools to improve energy efficiency and install renewable energy technologies
- $85 million to support additional retrofits in social housing
- $50 million in commuter cycling infrastructure like cycling lanes and barriers
- $22 million in electric vehicle charging infrastructure
More to come.
