Today, Ontario’s Minister of Finance Peter Bethlenfalvy introduced the final budget of the Ford Government’s four-year mandate. Titled Ontario’s Plan to Build, the Budget contains the government’s ideas to rebuild Ontario’s economy following challenges brought on by the COVID-19 pandemic, to fight the rising cost of living and to improve the province’s health system capacity writ large.
The budget is broken down into five key priorities:
- Rebuilding Ontario’s Economy
- Working for Workers
- Building Highways and Key Infrastructure
- Keeping Costs Down
- Planning to Stay Open
The Budget centres on developing key areas of the province’s economy – including the mining, manufacturing, and energy sectors – to create jobs, and bring about economic prosperity. Previously announced initiatives such as the Critical Minerals Strategy, investments with major auto manufacturers such as GM and Honda are touted as foundational pillars that represent opportunities where jobs and investment can be brought to the province.
Also included are proposals designed to appeal to constituencies the Progressive Conservatives need to sway to realize another mandate when voters go to the polls on June 2. Highway developments such as the 413 and the Bradford Bypass, job training programs, an increase in the minimum wage and moving provincial agencies outside of downtown Toronto are all expected to be popular with the suburban and rural Ontarians whose votes are necessary to pave the way for an electoral victory that may see Doug Ford return to the Premier’s Office once voters have had their say.
Ontario’s Real and Nominal GDP
In 2022, the province’s nominal GDP — the Gross Domestic Product based on current prices — is expected to grow 6.7 per cent, compared to that of 2021. When adjusting for inflation, the real GDP growth for 2022 is projected at 3.7 per cent from last year’s levels at 4.3 per cent.
The Budget indicates that the projected annual real GDP growth for Ontario between 2023 and 2025 will be less than that of the previous year. The drop in the annual real GDP levels indicate that the growth in the monetary value of all of Ontario’s goods and services will be less year-over-year, therefore a stagnation in the province’s production capacity and economic performance.
Deficit Outlook Compared to 2021 Budget
Budget 2022 shows a more positive deficit trend for Ontario, compared to the projections in Budget 2021.
The initial deficit projected in 2021 indicates $33.1 billion for years 2021-2022. However, Budget 2022 indicates a much smaller deficit level at $13.5 billion. Likewise, for years 2022-2023 and 2023-2024, Budget 2022 reports $19.9 billion and $12.3 billion respectively in deficit outlooks, compared to $27.7 billion and $20.2 billion for the two consecutive years.
Employment Recovery and Job Gains
In 2021, 7.3 million Ontarians were employed, bouncing from 7 million in 2020 due to the COVID-19 pandemic. The budget projects that in 2022, the province’s employment levels will increase to 7.6 million, and continue to increase until 8 million in 2025, reaching a historic 8-year high.
Rebuilding Ontario’s Economy
The Ford government is set on rebuilding Ontario’s economy through historic spending in infrastructure, including massive investments in auto-manufacturing, and enhanced supports for workers to attract and develop a skilled workforce. While the government has created more than 500,000 new jobs since taking office in 2018, they continue to focus on ways to increase jobs and economic activity.
Key measures include:
- The Critical Minerals Strategy, a five-year road map that will help strengthen Ontario’s position as a global leader in supplying critical minerals and Ontario’s supply chain for electric and hybrid vehicle manufacturing along with a Critical Minerals Innovation Fund to support the mining industry, academia, start-ups and research
- A Low-Carbon Hydrogen Strategy to accelerate the development of the low-carbon hydrogen economy
- Providing $91 million to help make electric vehicle chargers more accessible
- Proposing to extend the temporary enhancement to the Regional Opportunities Investment Tax Credit to 2023
- Investing $25 million over three years to the Indigenous Economic Development Fund
- Increasing overall investment in broadband to nearly $4 billion, ensuring every community has access to high-speed internet by the end of 2025
- Increasing Venture Ontario’s venture capital funding from $100 million to $300 million
Working for Workers
The Ford Government’s focus on skilled trades has been given renewed focus with new money in skills development and jobs programs. The Working for Workers Act modernizes employees’ rights by introducing a right to disconnect, support for gig workers, and banning non-compete clauses, among other things.
- $1 billion annually in employment and training programs
- Additional $5 million for the launch and expansion of the Better Jobs Ontario program, in addition to the nearly $200 million invested over the last three years for the Second Career program
- Additional $15.8 million to the Skills Development Fund
- Additional $114.4 million over three years in the Skilled Trades Strategy
- Additional $268.5 million over three years to Employment Ontario for skills training and employment programs
- Expanding college degree granting to produce more graduates in applied fields
Jobs + Wages
- Raising the general minimum wage to $15.50 per hour, starting October 2022
- Investing $9 million over three years to nine Indigenous governed and operated Indigenous Institutes
- $6.9 million over three years for the Investing in Women’s Futures program
- $15.1 million over three years in the Ontario Immigrant Nominee Program
- $45.2 million over three years to provide access to specialized mental health services for public safety personnel
- $56.8 million to increase capacity in emergency health services and first responders
- $7 million to support the Dedicated Offload Nursing program
- Additional $2 million over two years for an emergency volunteer program
Building Highways and Key Infrastructure
The government is Building Ontario with significant investments in infrastructure. Even prior to COVID-19, the Ford Government began planning for large-scale infrastructure projects through its highways and subways programs. With the pandemic, they doubled down and moved forward at relentless speed to secure key milestones for the 2022 Election.
More than $158 billion over the next 10 years on construction, rehabilitation and modernization of new school, hospitals, public transit, roads, bridges, and broadband expansion.
- $25.1 billion over ten years, including signature projects like Highway 413 and the Bradford Bypass.
- Other commitments include the QEW Garden City Skyway rehabilitation, building a new Highway 7 between Kitchener and Guelph, widening Highway 17 from Arnprior to Renfrew, expansion of Highway 401, reconstruction of Highway 101 through Timmins, and targeted projects in Northern Ontario.
- $61.6 billion for public transit over ten years including GO Expansion; includes Bowmanville GO Rail extension, London GO Rail Extension and Niagara GO Rail extension.
- Ford’s signature $28.5 billion Ontario Subways Plan is moving forward with the Ontario Line, three-stop Scarborough Subway, the Yonge North Subway Extension, and the Eglinton Crosstown West Extension that will eventually connect to Pearson International Airport.
- The government also committed to furthering its Transit-Oriented Communities program to build more homes around transit stations to make higher-order transit available to more people.
Education + Post-Secondary
- Nearly $6 billion for post-secondary and $21 billion for education over 10 years.
Keeping Costs Down
Budget 2022 indicates that affordability will continue to be a key theme across government initiatives. With cost of living being top of mind for many Ontarians, the province looks to tackle this by implementing policies to make life more affordable.
Budget 2022 re-announces many key pre-budget commitments centred around affordability, such as the More Homes for Everyone Plan, the $10 a day childcare program, the temporary cut of gas and fuel taxes, and the elimination of license plate renewal fees and stickers.
Affordability measures in Budget 2022 are laid out across a 3-point plan to address the skyrocketing costs of housing, transportation, groceries and other essentials. Key commitments include:
- A housing affordability and supply plan that responds to recommendations of the government-appointed Housing Affordability Task Force. The plan proposes measures that would crack down on foreign real-estate speculation, including increased tax rates for non-residents; strengthened consumer protections; consultations on multi-generational communities; better use of provincially-owned land for non-profit housing; and measures to expedite approvals, including over $19 million to clear Ontario Land Tribunal and Landlord Tenant Board backlogs.
- Investing $395 million to cover the costs of inflation associated with the $13.2 billion federal investment (by 2026-2027) in childcare. With retroactive rebates being sent to parents beginning in May – in the midst of the election period – this will provide some relief to thousands of parents facing high and rising child care costs, addressing a key political issue.
A Plan to Stay Open
Polling has shown time and time again that health care is a top priority for Ontarians and that continues to be true going into this election. With the pandemic still fresh on voters’ minds, the government has health transformation in its sights, demonstrating that the government intends to rebuild and improve a system strained by two-plus years of a global pandemic.
Ontario’s Plan to Stay Open centres on investments in health infrastructure and critically-needed staffing – shoring up vulnerabilities in strained hospitals, backlogged care, and long-term care homes that buckled under the pressure of COVID-19.
- Health human resources investments include $230 million to deploy and hire more health care students and workers in hospitals; $124 million starting in 2022-23 to modernize clinical education for nurses, $142 million to recruit and retain health care workers in underserved communities – including a new $61 million Learn and Stay Grant – and $49 million over three years to develop programs to train, recruit and retain critical care workers.
- $42.5 million will be spent to expand seats in medical schools, including priority electoral regions Brampton and Scarborough.
- Responding to criticism over public sector wage cap legislation, government is investing $2.8 billion over three years to raise personal support worker wages and $764 million over two years to provide nurses one-time $5,000 retention bonuses.
- Long-term care sees $60 million over two years in community paramedicine for long-term care, $8.3 million for new specialized behavioural unit beds in two homes, and a recommitment to more than 30,000 new beds by 2028.
- Seniors at home (and those who care for them) remain a priority, with $1 billion more in home care over the next three years, $100 million in additional funding over three years for community supports, $5 million more a year for three years for additional dementia services, and $110 million for a new refundable Ontario Seniors at Home Tax Credit.
- Hospital investment gets a spotlight – particularly capital investment in this election Budget, with $40 billion committed over 10 years – $10 billion more than last year, with projects highlighted in electoral battlegrounds across the GTA. Other commitments include $300 million as part of the Surgical Recovery Strategy and an additional $3.3 billion this year in acute, post-acute and critical care beds.
- Protecting against future waves and pandemics by stockpiling personal protective equipment and other critical supplies, and by investing $15 million over three years in a new Life Sciences Innovation Program.
- In recognition of the difficulties that all Ontarians have experienced during COVID, and acknowledging a gap in existing support, the government is making investments of $204 million in mental health and addictions.
- The Budget also commits, without specifics, to working with stakeholders, experts, and federal and provincial governments to manage drug costs, as well as creating an advisory table to explore improving access to take-home cancer drugs.
Opposition Reactions + Positioning
In response to the budget, Ontario NDP leader Andrea Horwath warns of potential cuts which may be necessitated under the PC’s spending plan. They say the Budget will strip $1.3 billion from the Ministry of Education, $685 million from Post-Secondary Education, $632 million from Children’s and Social Services and $71 million from Justice for a total of $2.7 billion in cuts according to the NDP.
Horwath is of the view that rather than investing in better health care, education, and making life more affordable, the Premier is choosing “his buddies over the rest of us”. She expects that these forewarned cuts could result in the layoff of tens of thousands of critical front-line workers.
Speaking in the House, NDP Finance Critic Catherine Fife cautioned that the budget does not address the climate crisis while featuring everything from “smog and highways to houses that no one can afford on the front cover.” We can expect that the NDP will concentrate its messaging spotlighting its contrasting vision for health care, education, affordability, and environmental issues.
Meanwhile, Ontario Liberal Leader Steven Del Duca led his response and critique of the government’s budget by zeroing in on a series of cuts that would affect the Ministry of Education, including the end to $2 billion in COVID protections for schools.
In his own words, Del Duca stated “the lack of ambition for Ontario is breathtaking from the Ford Conservatives. Not a single new idea to improve our schools or provide better care for our seniors.” He followed with a nod to his own announcement schedule for tomorrow of four new tax changes that he says will help families and businesses, ensure those who have earned high profits pay their share.
What to Expect Next
While the Budget was tabled in the legislature today, it will not receive passage prior to the legislature’s dissolution for the general election.
Instead, the PCs will use the Budget as the basis of their platform commitments on which Ontarians will cast their votes on June 2.
The writ is expected to officially drop on May 4, marking the official start to a long-running informal campaign toward the general election. You can expect to see all political parties formally hit the hustings with their campaigns this upcoming weekend.
Authored by members of H+K’s Public Affairs + Advocacy team including Stephanie Dunlop, Melissa Pasi, James Lin, Shanice Scott, Matt Boudreau, Alexandra Valcour, Patrick Rooney, Sarah Dickson, Heon Lee, and Isha Chaudhuri.