The fact that the Ontario Budget for 2017-2018 is a balanced budget is one of the forefront messages in the recently released document. However, a balanced budget is commendable, especially since it’s the first balanced budget since the recession doesn’t erase the debt the province has accumulated and will still require payment to service.
“Budget 2017 demonstrates that much of Ontario’s fiscal outlook will depend on the prosperity of our private sector,” said Richard Koroscil, Interim President & CEO, Ontario Chamber of Commerce (OCC). “The government acknowledged that business investment spending slowed in 2016, though expects firms to increase investment by 3.1 percent, annually, to 2020 – an amount that would outpace growth in real GDP growth and household spending. These assumptions depend upon business confidence – which has fallen precipitously in recent years according to the Ontario Economic Report – and U.S. demand, which is subject to considerable risk given recent comments by American President Donald Trump.”
On the positive side, a balanced budget does allow the government more flexibility in program funding and that is seen in the budget. “Peterborough is well served by this budget,” Hon. Jeff Leal, Minister of Agriculture, Food and Rural Affairs and Minister Responsible for Small Business told me in a phone call hours after the budget. “The investment in pharmacare for children will help fill a gap for those without full benefit packages and allow parents to put that money to other uses, while continued investment in the Red Tape Challenge will help reduce the regulatory burden for small business.”
With 93% of Peterborough Chamber membership falling into the small business category of 100 employees or less it is good to hear the commitment to this program reiterated. The Chamber is also pushing for a Red Tape Challenge analysis of the small business sector as a whole.
When asked how he would describe the budget in one sentence Minister Leal replied, “building for tomorrow.”
The private sector has had a positive impact on the economy and demonstrates a clear commitment to good jobs throughout our province. 98% of all new jobs since the recession in Ontario have been full time, and 78% in above-average wage industries.
The OCC released its analysis of the budget shortly after the document was delivered at Queen’s Park. Picking up on their highlighted areas, what does the budget mean for Peterborough?
In Budget 2017, the Government indicates it will invest $13.5 billion through Moving Ontario Forward to enable faster and more frequent service on the GO network and Union-Pearson Express In addition, the Government announced that funding for the Connecting Links program will increase to $30 million per year by 2018-9.
Business Growth Initiative
The Business Growth Initiative was announced in Budget 2016 as a plan to support Ontario’s transition to a new economy. Budget 2017 includes an expansion of the BGI by $650 million over five years.
Cap and Trade
In Budget 2017, the Government indicates it is working on a separate system of Ontario-based voluntary carbon offsets to support the government’s carbon-neutral commitment. The proceeds of the carbon allowance auctions are expected to be $1.8 billion in 2017-8 ($1.9 billion was projected) and $1.4 billion in 2018-9. Projected spends of those proceeds include:
Financial Literacy and Skills for the Knowledge Economy
In Budget 2017, the Government reiterated its support for injecting financial literacy into the secondary school curriculum. In addition, the Government has committed to invest nearly $190 million over three years in the Career Kick-Start program which will create more opportunities for high school and post-secondary students, along with recent graduates, to develop job relevant skills.
Health Care Booster Shot
The government is providing for greater health care spending in the form of a $7 billion “booster shot” over the next three years. In budget 2017 the government also plans to spend an additional $11.5 billion over the next three years, including the cost of the new children and youth pharmacare program with annual growth in health care spending is projected to be 3.3. percent on average.
OHIP+: Children and Youth Pharmacare
The Government plans to provide universal drug coverage to all children and youth aged 24 and under, regardless of family income. Beginning in 2018, OHIP+: Children and Youth Pharmacare will cover the costs of medicines funded through the existing Ontario Drug Benefit Program. The preliminary estimate of the cost of OHIP+ is $465 million per year.
We encourage the government to work with insurance firms and employers to determine the best way to ensure Ontario children and youth have access to the medicines they need, without duplicating or disrupting current coverage. We hope to work with government to design a plan that works in tandem with private drug benefit programs.
Interprofessional Primary Care Teams
The Government is investing a further $15 million to create new, or expand existing, interprofessional care teams.
In Budget 2017, the Government projects that business investment will outstrip real GDP growth and household spending, rising by an average 3.1 percent between 2017 and 2020. Government attributes this growth to a competitive Canadian dollar, strong U.S. demand, and improving domestic opportunities.
Previously, the Ontario government released a set of 16 comprehensive measures aimed at helping Ontarians find affordable homes and bring stability to the real estate market. In Budget 2017, they detailed their plans to address the complex network of factors influencing the Ontario real estate market.
Welcoming New Canadians
Budget 2017 reveals that federal government has increased the province’s 2017 allocation for the Ontario Immigrant Nominee Program (ONIP) by 500 nominees to a total of 6,000. The OINP is also modernizing its application process this year with a new, paperless online system that will speed up the application process, improve customer service, and help employers find the skilled workers they need more quickly.
There are a couple other areas of concern as Ontario will not return to planned Corporate Income Tax cuts, jeopardizing tens of billions of dollars in potential capital investment and hundreds of thousands of new jobs.
And while there is no deficit over the planning period, there is also no plan for surplus. Ontario’s debt will rise by 21per cent in the next three years as a result of interest charges, with no plans to begin debt repayment.
Budget 2017 also sets directions around mental health, cyber security, the Changing Workplaces Review, growth in agri-food and aerospace all issues and sectors that apply to Peterborough.
Read Budget 2017
The Peterborough and the Kawarthas Chamber of Commerce acts as a catalyst to enhance business growth, opportunity, innovation, partnerships and a diverse business community.