Finance Minister Charles Sousa today released the 2015 provincial budget. The budget reflects the Liberals attempt to find more innovative ways to grow the economy while maintaining public services. This includes unlocking the value of provincial assets to support the largest infrastructure investment in Ontario’s history.

“Ontario’s 2015 Budget is more than a report on the province’s finances. It is about protecting, preserving and enhancing the quality of life of people all across this province. Ontario is poised to lead Canada in the modern economy through historic infrastructure and public transit investments which will not only move goods to market faster and get people home from work safer, but make Ontario a more competitive, more productive province.
This budget outlines our plan to invest in people’s skills and training, support a dynamic and competitive business climate, foster a secure retirement and manage our program spending. Ontario is on track to balance its budget by 2017–18 and we will do so in a way that is both fair and responsible”, said Charles Sousa, Minister of Finance.

Ontario is projecting a deficit of $8.5 billion in 2015-16, less than forecast in the 2014 Budget, and which would be the lowest level since the onset of the global recession. The Liberals say they will continue to ‘take a deliberate approach’ to balance the budget, with a deficit of $4.8 billion forecast for 2016-17 and a balanced budget by 2017-18.

The government’s four-part plan is building Ontario up by investing in people’s talents and skills, building public infrastructure such as roads and transit, creating a dynamic, innovative environment where business thrives, and building a secure retirement savings plan.

1. Building Up Ontario’s Infrastructure

The 2015 Budget expands on Ontario’s plan to make an investment of more than $130 billion in public infrastructure over 10 years. This includes:

• Increasing the dedicated funds for Moving Ontario Forward by $2.6 billion for a total of $31.5 billion over 10 years — about $16 billion in transit projects in the Greater Toronto and Hamilton Area (GTHA) and about $15 billion available for transportation and other priority infrastructure projects outside the GTHA. The increase is due to a higher target from the Province’s asset optimization plan; and
• A planned investment of $11.9 billion in 2015-16 on infrastructure such as roads, bridges, public transit, water systems, hospitals and schools.
• Broadening Hydro One ownership to create lasting public benefits and ongoing public and ratepayer protections.
• Reviewing a number of prime-located real estate assets for sale.

2. Partnering With Business To Create Jobs

Ontario continues to create rewarding, high-paying jobs say the Liberals. According to the province, employment has rebounded strongly from the recessionary low in June 2009, with over half a million net new jobs created — three-quarters of which are in industries paying above-average wages. The province says we have more than recovered all the jobs lost since the global economic recession.

The 2015 Budget:

• Increases funding for the 10-year, $2.5 billion Jobs and Prosperity Fund to partner with more businesses, enhancing productivity, increasing innovation, growing exports and creating jobs. The 2015 Budget announces that the fund will be increased by a total of $200 million beginning in 2015-16, increasing the fund to $2.7 billion over 10 years and extending eligibility to the forestry sector.
• Continues, beyond March 2016, electricity pricing support for qualifying large northern industrial facilities, which sustain jobs and global competitiveness.
• Tackling climate change now to ensure a prosperous economic future and a flourishing society. Ontario will move forward with a cap-and-trade system as its carbon pricing mechanism. Proceeds from a cap-and-trade program will be directed towards key priorities that will help lower greenhouse gas emissions.

Developing A Highly Skilled Workforce

• By continuing to improve education and skills training, from preschool and full-day kindergarten through to postsecondary education and trade apprenticeship programs, with innovations such as experiential learning pilot programs.
• The prvonce is investing an additional $250 million over two years in the Ontario Youth Jobs Strategy, bringing the total investment in youth employment programming to more than $565 million.
• The Ontario Student Assistance Program will be modernized to strengthen financial assistance for students.

3. Managing Responsibly

• Continuing Program Review, Renewal and Transformation (PRRT), a fundamentally new approach to multi-year planning and budgeting. It is identifying both short- and longer-term opportunities to transform programs and services, and making tough choices to end programs that are not performing, do not link to key priorities or no longer serve a clear public interest. For 2014-15, a $250 million program review savings target was met through a number of initiatives that identified efficiencies, lowered costs or reduced administrative overhead without affecting front-line services. The program review savings targets are $500 million for each of 2015-16, 2016-17 and 2017-18.
• Managing program expense growth over the medium term, which is projected to be held to an average of 0.9 per cent between 2013-14 and 2017-18.◦Total health sector expense is projected to grow on average by 1.9 per cent per year, education sector expense by 2.0 per cent per year, children’s and social services sector expense by 2.9 per cent per year and justice sector expense by 1.5 per cent per year.
• Continuing to negotiate collective agreements with the Ontario Public Service and broader public sector within Ontario’s existing fiscal framework, which does not include additional funding for wage increases. Any modest wage increases must be offset by other measures within current funding available to employers to create a net zero agreement.◦Since July 2012, the average annual negotiated wage increase across Ontario’s provincial public sector has been 0.6 per cent. This is lower than Ontario’s municipal public sector (1.9 per cent), the federal public sector in Ontario (1.7 per cent) and Ontario’s private sector (2.0 per cent).
• Combatting the underground economy, which is estimated to be $15 billion in annual economic activity in Ontario, to help level the playing field for business. The Province is achieving this through better collection of information and analytics, increased measures to address contraband tobacco, and reducing corporate tax avoidance. The Province will also propose to make the use, manufacture or distribution of electronic sale suppression technologies illegal.Managing ResponsiblyContinuing Program Review, Renewal and Transformation (PRRT), a fundamentally new approach to multi-year planning and budgeting. It is identifying both short- and longer-term opportunities to transform programs and services, and making tough choices to end programs that are not performing, do not link to key priorities or no longer serve a clear public interest. For 2014-15, a $250 million program review savings target was met through a number of initiatives that identified efficiencies, lowered costs or reduced administrative overhead without affecting front-line services. The program review savings targets are $500 million for each of 2015-16, 2016-17 and 2017-18.

Most private-sector forecasters predict that Ontario’s economy will rank among the provincial growth leaders in each of the next two years. On June 1, 2014, the hourly minimum wage rose to $11. It will rise to $11.25 in October 2015. The province is also introducing the sale of beer in grocery stores.