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Ontario’s 2022 budget: A window into Premier Ford’s reelection bid

Ontario’s 2022 budget: A window into Premier Ford’s reelection bid

CHRIS YOUNG/THE CANADIAN PRESS

CHRIS YOUNG/THE CANADIAN PRESS

Ontario’s Minister of Finance Peter Bethlenfalvy released the province’s 2022 budget this afternoon, titled Ontario’s Plan to Build which is centered around the five key themes of rebuilding Ontario’s economy, supporting workers and small businesses, building highways, transit and hospitals, making life more affordable and ensuring the province remains open post-pandemic.

With the Legislature adjourning today for the summer and scheduled to resume in September, the opposition will not have an opportunity to discuss and debate the budget during Question Period. They will, however, have all of May to challenge it—in the media, in the public, and among voters—as the provincial election is just around the corner and the campaign is likely to begin next week.

It also means that Premier Ford and his government will not be able to pass the budget bill through the Legislature prior to adjournment, making its purpose clear: Ontario’s 2022 budget is essentially a party platform for the Ontario Progressive Conservatives (PCs), filled with election promises that Ontarians will need to consider as they head to the polls in five weeks.

This is the third time in recent memory that the government has introduced a budget that would not be debated in the Legislature. In 1999 and then in 2014 provincial budgets were introduced but not debated or passed because of the election call. It is interesting to note that Premier Harris (1999) and Premier Wynne (2014) were both re-elected to a majority government and upon taking office, reintroduced the same pre-election budget. Will this year’s budget follow the same path? We will have a better idea over the next 35 days leading up to election day on June 2.

“This is our plan to get it done. The people of Ontario will vote on this budget, and it will be up to them if they want to pass this,” said Minister Bethlenfalvy, referring to the upcoming provincial election.

By the numbers, Ontario is projecting a deficit of $13.5 billion in 2021-22, approximately $19.6 billion lower than the outlook published in the 2021 budget. While the new number is certainly a positive development, some may find that to be somewhat alarming given the significant drop based on predictions made in the previous economic outlook. Ontario’s net debt-to-GDP ratio is projected to be 40.7 per cent in 2021–22, 8.1 percentage points lower than the 48.8 per cent forecast presented in the previous budget. Lastly, Ontario’s real GDP is expected to increase by 3.7 per cent while employment figures are already three per cent above pre-pandemic levels and expected to grow at an average of two per cent annually.

NATIONAL’s first take

Our initial analysis is as follows:

  • Premier Ford has gone right back into his 2018 election playbook to put money back into the pockets of the people of Ontario by finding ways to cut small costs and provide savings to make life more affordable. Albeit, just in time for the June 2 election
  • In the same vein, the Ontario government says it is again open for business, with various commitments to support small business growth and encourage entrepreneurship
  • Healthcare remains top of mind and central to provincial spending as it has over the last decade, but even more so now since the pandemic uncovered critical shortcomings, particularly around capacity constraints and domestic production of critical supplies
  • Major infrastructure investments in highways, transit and hospitals continue to dominate capital spending. With the Capital Plan for Building Ontario
  • Not a year goes by without mention of the Ring of Fire, but it seems as though there is now a multitude of strategies being developed to support its eventual development

Opposition’s reaction

Today’s budget initiates a month-long opportunity for opposition leaders to address what they will do differently if elected, and how.

As NDP Leader Andrea Horwath prepares to enter her fourth election at the party’s helm, she and her party will highlight the slash and burn approaches of Premier Ford and the PCs. “I am absolutely concerned about bait-and-switch,” said Horwath. “The budget was full of ‘gimmicks’ and failed to recognize the seriousness of housing unaffordability and rising inflation.”

Ontario Liberal Leader Steven Del Duca has already announced his intention to make seniors a top priority, signalling that today’s commitments likely fall short of his vision for Ontario’s oldest demographic. Del Duca noted that if elected Premier, he would scrap large portions of the fiscal plan.

In response to the budget, Green Party Leader Mike Schreiner said the following on Twitter, “Doug Ford just announced a 1950s-era Sprawl Budget that is taking us backward and setting Ontario up for an expensive, unhealthy province that will pave over our children’s future.”

What does this mean for Ontario?

In the lead-up to election day party leaders, candidates and volunteers will crisscross Ontario to warn voters about other leaders and their platforms. The four main parties and their plans for how they would take Ontario into the future are dramatically different. Now it is up to the people of Ontario to decide. Sharpen your pencils as election day is only 35 days from now. One thing is for certain, whoever is fortunate enough to lead their party to victory and be elected Premier on June 2 will have a daunting task as Ontario emerges from two plus years of the COVID-19 pandemic.

Core themes

This year’s budget is split between the five core themes and below are some of the key highlights:

Rebuilding Ontario’s economy

  • Investments in new critical technology initiatives to support access to, and the commercialization of critical technologies
  • Provincial agency jobs to regions across the province beginning with the relocation of the Workplace Safety and Insurance Board’s headquarters to London, Ontario
  • Advancing the Critical Minerals Strategy and $5 million to create a Critical Minerals Innovation Fund as well as $1 billion towards upgrading legacy infrastructure including all-season roads to the Ring of Fire
  • Making Ontario a global-leading producer of clean, low-emission steel to help build vehicles domestically
  • $4 billion to support high-speed internet access to all Ontarians by the end of 2025

Working for workers

  • $1 billion in annual funding towards employment and training programs to help people retrain and upgrade their skills
  • $5 million in new funding in 2022–23 in addition to the nearly $200 million already invested through the Second Career program as Better Jobs Ontario
  • An additional $114.4 million over three years in its Skilled Trades Strategy
  • To support students, Ontario is expanding college degree granting to help build a pipeline of job-ready graduates in applied fields and allow students to gain the education, experience and skills to enter the workforce faster
  • Ontario is providing $268.5 million over three years in additional funding through Employment Ontario to strengthen the government’s skills training and employment programs, including pandemic recovery initiatives
  • The Ontario government is increasing the general minimum wage to $15.50 per hour on October 1, 2022, while guaranteeing digital platform workers the general minimum wage
  • The government is investing $15.1 million over three years in the Ontario Immigrant Nominee Program (OINP), which nominates applicants for permanent residence who have the skills and experience to match Ontario’s labour market needs
  • To further support Ontario’s first responders, the government is investing $56.8 million in 2022–23 to increase capacity in emergency health services in communities across Ontario

Building highways and key infrastructure

  • More than $40 billion over the next 10 years in hospital infrastructure, including about $27 billion in capital grants
  • Investing $21 billion, including about $14 billion in capital grants, over the next 10 years, to support the renewal and expansion of school infrastructure and childcare projects
  • Ontario is investing nearly $96 million over three years to protect public safety and critical infrastructure during unlawful demonstrations and illegal blockades that impede international border crossings and protect vital supply chains on both sides of the border
  • Ontario has committed close to $1 billion to support critical legacy infrastructure such as all‐season roads to the Ring of Fire
  • $10 million in 2022–23 to maintain the Infrastructure Talent Accelerator grant, which helps apprentices participating in the in‐demand trades train to help build historic infrastructure projects, such as the Ontario Line Subway Project and Scarborough Subway Extension
  • Investing $25.1 billion over the next 10 years to support the planning and construction of highway projects across the province, including: Building Highway 413, building the Bradford Bypass, the first steps to enable the future widening of Highway 401, improving the QEW Garden City Skyway in St. Catharines
  • Continuing the next phase of construction for the new Highway 7 between Kitchener and Guelph
  • Reconstructing Highway 101, the Timmins Connecting Link
  • Investing $61.6 billion over 10 years for public transit, including: Breaking ground on the Ontario Line, advancing planning work for the Sheppard Subway Extension, planning and design work for the Eglinton Crosstown West Extension to Toronto Pearson International Airport, the Bowmanville GO Rail Extension, weekday GO Rail trips between London and Union Station in Toronto, passenger rail service to Northeastern Ontario.

Keeping costs down

  • A long-term plan to address the housing crisis, informed by the Housing Affordability Task Force’s recommendations
  • Eliminating and refunding license plate renewal fees for passenger vehicles, light-duty trucks, motorcycles and mopeds, cutting the gas tax by 5.7 cents per litre for six months beginning July 1, 2022, and removing tolls on Highway 418 and 412
  • An additional $300 in Personal Income Tax (PIT) relief, on average, to about 1.1 million taxpayers by enhancing the Low-income Individuals and Families Tax Credit
  • A $13.2 billion agreement with the federal government to achieve an average of $10-a-day childcare by September 2025

A plan to stay open

  • More than $40 billion over the next 10 years in hospital and healthcare infrastructure supporting more than 50 major hospital projects that would add 3,000 new beds over 10 years
  • An additional $3.3 billion in 2022–23, bringing the total additional investments in hospitals to $8.8 billion since 2018–19
  • An additional $1 billion over the next three years in home care as well as a new, refundable Ontario Seniors Care at Home Tax Credit to help seniors aged 70 and older with eligible home care medical expenses to help people stay in their homes longer. Significantly expanding Ontario’s healthcare workforce through a new Learn and Stray Grant for postsecondary students, investments to retain nurses, commitments to increase healthcare capacity, and the expansion of new medical schools
  • Continued investments through the Ontario Together Fund to support manufacturing of critical supplies that are Ontario-made including personal protective equipment (PPE)
  • $15 million over three years in a new Life Sciences Innovation Program to develop and scale up the commercial potential of therapeutics and medical and digital technologies

Next steps

NATIONAL will continue to monitor political and industry reactions and provide further updates. As always, our team of Public Affairs experts are available to provide further insights and analysis on today’s announcement and how it impacts your organization.

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Written by Stephen Adler | Bob Richardson | Troy Aharonian | Stephanie Gomes

Ontario’s 2022 budget: Setting the stage for the upcoming election
April 22, 2022