2017 ONTARIO BUDGET ANALYSIS

April 27, 2017


SOMETHING FOR EVERYONE — BUT WILL IT BE ENOUGH?

“Let it always be said that in Ontario, we are as compassionate as we are competitive. As fair as we are prosperous. And that balance, one that is at the heart of our civil society, is just as important as the fiscal balance we have announced today.”

  • Finance Minister Charles Sousa.

In bygone days, before fixed election dates, today’s provincial Budget would have set off a wave of speculation about a possible snap election – it has that much of a campaign feel to it. Of course, if election timing was still up to the party in power such speculation would be a non-starter for the Kathleen Wynne Liberals, as no government would ever call an election with popularity as low as theirs is right now. Trying to fix that was the obvious undercurrent as Finance Minister Charles Sousa delivered his 2017-18 fiscal plan.

The government is clearly proud of its balanced budget, with Sousa mentioning it at least 20 times in his speech — with a pledge that the 2018 and 2019 Budgets will also be balanced. In fact, the word “budget” almost never appears without “balanced” in front of it.

As has become the norm for modern Budgets, this one is heavy on re-announcements and re-affirmations of programs and spending that had been announced in previous plans or unveiled in separate announcements in recent weeks. But all were carefully couched to ensure they hit the government’s targets as it keeps a careful eye on the June 2018 election.

Reading through the 22-page speech and accompanying documents, you can practically see the checklist of key demographic groups the Liberals are trying to woo back, including seniors, students, parents, young adults, caregivers and patients.

Everyone gets something they should see as positive. The big question is whether it’s positive enough to get them to vote Liberal, which they keep telling pollsters they won’t.

OH, GOODIES

Among the treats outlined in the Budget:

  • Seniors

In part to give seniors a bauble and to encourage ridership on the plethora of public transit projects either planned or under construction across the province, the government is introducing the Ontario Seniors Public Transit Tax Credit, allowing 15% of annual public transit costs to be claimed on their annual tax return, a benefit worth an average of $130 annually.

The government is also spending $8 million over three years to add 40 new Elderly Persons Centres by 2018-19, dedicating $85 million to home nursing, personal support and physiotherapy, expanding home and community care (see below) and launching a $100-million dementia strategy.

Operators of long-term care homes are also being encouraged to hire more staff, scrap four-bed wards and redevelop more than 30,000 beds.

  • Students

Those too young to vote are being promised $16 billion over the next decade for renovations and new elementary and secondary school construction as well as a $6.4 billion increase in education funding over the next three years.

For the post-secondary demographic, many of whom are 18 or older, they are being reminded that this fall welcomes the revamped Ontario Student Assistance Program that will provide free tuition to more than 210,000 students. What’s more, new graduates won’t have to start making payments on the Ontario portion of their loans until they are earning $35,000 annually.

  • Parents

This is a key segment of the electorate for the Liberals, with the second chapter of the 2017 Budget document entitled Helping You and Your Family.

The headline of the budget is free pharmacare for all Ontario residents under the age of 24, regardless of family income. Given a campaign-style descriptor “OHIP+: Children and Youth Pharmacare,” the program provides universal drug coverage for more than 4,000 medications without co-payment or deductible so that “parents never have to choose between paying for their children’s prescription drugs and providing other essentials.”

The government is also attempting to bring some measure of sanity to the booming real estate market to both make home ownership more affordable (and accessible) and provide stability to renters by expanding rent control to all privately owned properties.

  • Young Adults

The government is going to recalibrate its Second Career program as well as investing $190 million over three years in a Career Kick-Start Strategy to create 40,000 “work-related opportunities” for students and recent graduates.

It is also a safe assumption that young adults will benefit greatly from the increased mobility of public transit expansion — both within major urban centres like Toronto, Ottawa and Hamilton, and connecting the densely populated areas of Southern Ontario with expanded GO Train service (although none of these are new announcements).

  • Caregivers

More supports for Ontarians who are caring for sick children or ailing parents are expected to come from a $250-million injection of funding into home and community care, and $20 million towards respite care for people who volunteer to care for a loved one.

This will further be supplemented by a new Ontario Caregiver Tax Credit, a 5.05% non-refundable credit that can be applied in the 2017 tax year.

  • Patients

Health-care spending is to increase by $7 billion this year, including a $518 million boost to hospital operating funds, $1.3 billion to reduce wait times and improvements to mental health and addictions services.

Over the next decade, $9 billion in capital funding is being invested in new hospitals — adding to the 34 hospital projects that are currently under way.

THE OTHER SIDE

Both Opposition parties also used Budget Day to reinforce their own campaign strategies.

PC Leader Patrick Brown was in full discredit mode, convinced that keeping the Liberals unpopular is his most direct route to the Premier’s Office.  Even before the Budget the Tories launched a “cook the books” message track, complete with “Chef Sousa” bobble-head dolls.

NDP Leader Andrea Horwath reinforced her newfound determination not to be out-progressived by the LIBs again, starting with her pre-emptive strike earlier this week promising universal pharmacare across the province. Like the Tories, New Democrats were predictably dismissive of today’s Budget, but Horwath seems bent on waging a policy war over the next year, talking about her own plans as a contrast to Wynne’s.

The writ drop for Election 2018 is almost exactly one year away. As today’s Budget made clear, the campaign is already under way.

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