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Ontario credit rating takes a hit

Ontario Finance Minister Dwight Duncan. Photo ontarioliberal.ca

By Greg Holden

Ontario Finance Minister Dwight Duncan said Wednesday that Standard and Poor’s, a credit rating agency based in New York, has changed Ontario’s outlook from stable to negative.

One day after the minority liberal government got their wish and had their budget passed, they now face the prospect of higher interest rates in the future unless they can get their house in order soon. The province continues to be laden with debt, and questions remain whether the province can balance its budget by the targets set by McGuinty’s government of 2017.

Unionized public sector workers from teachers to doctors have been asked to freeze their wages for two years, but the concern for Standard and Poor’s remains to be it’s shaky confidence in the liberals ability to hold down costs.

Premier Dalton McGuinty negotiated with the NDP to gain their support for the provincial budget and decided to accept an NDP proposed 2% tax increase on those making $500,000 a year or more. Duncan announced on Wednesday the new tax would add another $470 million to cut the deficit, now at $15 billion.