LILLEY: Latest budget shows how much Doug Ford's priorities have changed
· Toronto Sun
Spending-wise, the latest budget from the Doug Ford government at Queen’s Park is cautious and boring, at least in terms of the numbers. What you realize reading through it is how much the outlook of this government has changed in eight years.
The title of the budget is A Plan to Protect Ontario , which in reality isn’t that far off the title of their first budget in 2019 — Protecting What Matters Most .
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While the theme of protecting the province runs through both, how they plan to do that has changed. Gone is the Ford government that wanted to get government out of the way of business. Now the government is all about helping, assisting, investing in and, yes, protecting business.
Ontario in the business of funding businesses
Thus, the new $4-billion Protect Ontario Account Investment Fund.
“This $4-billion fund will be a critical tool for investing in Ontario’s growth,” Finance Minister Peter Bethlenfalvy told the legislature.
“By crowding in investment from pension funds and other private capital, we will identify and execute on a pipeline of new opportunities that will advance Ontario’s long-term economic and strategic priorities, making our province a winner — not for the next decade — but for the next century.”
Essentially, the Ontario government is starting a venture capital fund that will seek to find partners in both the private and pension fund sectors that will invest in new Ontario businesses. The plan is to partner with a private-sector investment manager to run the fund.
Once upon a time, the premier would have said that governments shouldn’t pick winners and losers, but now that is exactly what he is doing.
Protectionism has spread from White House
In fairness to Ford, the political and business landscape has changed dramatically since he was elected in 2018. Protectionism is suddenly back in fashion, mainly driven by U.S. President Donald Trump, but it is changing everything.
The global trading order is changing rapidly as well and around the world governments are taking a more interventionist stance than they otherwise might have in the past.
While the $4-billion price tag for this fund may seem high, in reality it is 1.6% of the province’s total projected spending for the coming year of $244 billion.
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Spending, revenues up moderately
Overall spending, including servicing the debt , is up by 2.4% in this year’s budget projections. Revenues are up by 2.3%, just above the inflation rate, with Bethlenfalvy projecting decent growth in personal income taxes while corporate income tax and sales tax revenues are expected to be relatively flat.
The budget deficit is pegged at $13.8 billion, but we can expect that to come in lower. Bethlenfalvy has a habit of projecting higher deficits and delivering better results. In last year’s budget, he projected a deficit of $14.6 billion; right now, it looks like it will come in at $12.3 billion.
Servicing that debt will cost a whopping $17.2 billion and take up 6.7 cents of every tax dollar collected. The only thing the Ford government can point to is that their interest payments eat up far less of the budget that the federal government’s budget.
Another big boost in health spending
The biggest spending increase is in the health sector, which will crest the $100-billion mark for the first time. After projecting health spending at $91.1 billion last year, the province actually spent $97.8 billion on health and this year is projected to spend $101.2 billion.
In total, health spending accounts for 41% of the total government budget. Since coming to office, the Ford government has increased health spending from $62.2 billion to what it is today, a massive 63% increase.
Education will see a small increase in spending from $40.5 billion to $40.8 billion. Post-secondary education and other program spending generally remain flat.
Remember these increases when you hear the opposition claim that Ford is gutting health care and education, as it’s simply not true.