On March 23rd, the Ontario Government released the 2023 Ontario Budget titled Building a Stronger Ontario. Finance Minister Peter Bethlenfalvy delivered his first budget since the last election in June of 2022.
The budget spends a record $204 billion. It should also be noted that there were also record government revenues due to inflation, low unemployment and faster than expected economic recovery from the pandemic that led to higher tax revenue for the province. The budget comes at a time when Ontario is facing a housing crisis, homelessness crisis, pandemic recovery, inflation and global economic uncertainty.
The budget deficit of $2.2 billion for 2022-23 is projected to be $2.2 billion. That is $17.7 billion lower than the previous fiscal year and suggests that the provincial government spent less than previously promised. Ontario is projected to run a deficit of $1.3 billion for the current 2023-24 fiscal year and a small $200 million dollar surplus for 2024-25. These deficits are much smaller than previous years when Ontario was responding to the pandemic in 2020, 2021 and 2022. Many time limited pandemic spending programs were allowed to expire. Ontario also plans to balance its budget 3 years earlier than previously forecasted and the provinces appear to be in a much stronger financial position than the federal and local governments.
Of the total provincial budget:
Last year, health care was the main theme of the provincial budget with housing being the main theme of the federal budget. This year, the focus of the provincial budget was on manufacturing and the economy. The province also reaffirmed public transit, highway and infrastructure programs while winding down programs related to the pandemic including sick days and the Social Services Relief Fund. The budget also included increased federal health transfers expected to be the big ticket spending item in the upcoming federal budget on March 28.
This provincial budget will be a challenge for municipal finances. There was no mention of replacing municipal revenues lost as a result of Bill 23. The City of Toronto and municipalities generally did not receive any funds to address pressures resulting from COVID. A failure to support municipalities will result in reduced services and higher property taxes locally. At the same time, there were no obvious cuts or signs of austerity from the Ford government as many had predicted.
Below are some highlights relevant to OMSSA members and the municipal human services sector:
Opposition parties, unions and many stakeholders were critical that the budget failed to invest in people. Despite record spending, concerns were raised around not doing enough to support social services, municipalities, climate change, education or health. OMSSA will work with our Members, municipal associations and stakeholder partners to further analyse the budget and collaborate on advocacy strategies for the upcoming fiscal year.
Budget News Release: https://news.ontario.ca/en/release/1002856/building-a-strong-ontario
Budget Highlights: https://budget.ontario.ca/2023/highlights.html
Full Budget Document: https://budget.ontario.ca/2023/contents.html
Darryl Wolk is Manager of Policy Development and Public Affairs for the Ontario Municipal Social Services Association. Darryl started with OMSSA in 2017. He has over ten years of government relations experience and graduated with an MBA from the University of Windsor in 2004. Darryl appreciates the opportunity to advocate and consult with Ontario’s municipal service managers, province and federal government to advance priority issues in the health and human services sectors.