Government of Ontario releases fall economic statement

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On November 7, Ontario Finance Minister Charles Sousa presented the government’s Economic Outlook and Fiscal Review to the Ontario Legislature. The fall economic statement allows the government to signal its fiscal priorities between budgets, and Minister Sousa’s November 7 statement indicated a new direction for the provincial government.
 
Under the leadership of Premier Kathleen Wynne, the provincial government appears to be moving away from the focus on fiscal restraint and austerity that prevailed under Dalton McGuinty.  While the Province remains committed to eliminating the deficit by 2017-18, the fall economic statement signalled a new commitment to targeted spending in priority areas in order to spur economic growth and protect key social programs.
 
Minister Sousa’s statement acknowledged that simply controlling spending growth would not balance the province’s budget, given that Ontario already has the lowest per-capita program spending in Canada and provincial revenues were $5 billion lower than 2010 projections. The fall economic statement rejected calls for across the board spending cuts, but also ruled out tax increases. Nonetheless, the statement expressed a new willingness to address the revenue side of the province’s budget equation in order to enable targeted investments in priority areas.
 
Priority spending areas include full-day kindergarten, the Ontario Tuition Grant, a youth jobs strategy, social assistance and infrastructure. Higher education is presented primarily as an important driver of the economic growth and job creation.  
 
Interestingly, there was no mention in Minister Sousa’s statement of public sector wage restraint. The full text of the Economic Outlook and Fiscal Review included broad references to the need to control compensation costs “within Ontario’s existing fiscal framework,” but the commitment to zero per cent wage increases for public sector employees that prevailed under Dalton McGuinty has disappeared.
 
Read the Finance Minister’s statement to the Legislature here:
http://www.fin.gov.on.ca/en/budget/fallstatement/2013/statement.html

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