Doug Ford says Toronto should adopt ‘lean practices’ to deal with funding shortfall

Ontario Premier Doug Ford said Toronto can’t continue to go to other governments “hat in hand” asking for funding as the city grapples with a more than $900-million shortfall of cash due to the COVID-19 pandemic.

The comments were made at an announcement in Hamilton, Ont., where the premier was re-announcing a 2023 budget commitment to hire more nurses.

When asked about the shortfall, Ford said officials should be “driving efficiencies” and “focusing on lean practices.”

“They can't just go there and think the taxpayer is going to constantly bail him out no matter if it's the municipal, provincial or federal government,” he said. “They have to start treating Toronto like they're spending their own money, then we'll see a big change.”

Toronto officials said earlier this week that significant cuts to services and state-of-good repair work may be necessary in 2024 after both the federal government and the province refused to inject significant funds into municipalities.

Speaking to reporters ahead of the April city council meeting, Deputy Mayor Jennifer McKelvie said Toronto was still “very much in the mode of recovery” following the pandemic.

“You’re going to see those cuts rapidly happen in 2024,” she said.

“If we don’t get assistance, we are able to use the reserves we’ve squirreled away to pay for this year. But it’s not a good strategy…it’s like taking out your RRSPs to pay your mortgage, or to pay your groceries. It’s not sustainable.”

Without aide from other governments, the city is looking at a nearly $1 billion shortfall. McKelvie suggested the city could make up some of that revenue by raising property taxes.

The city also has to take a freezing of development fees into consideration when addressing budgetary concerns. As part of Ford’s housing strategy, some development charges—which are collected by cities to help pay for the cost of municipal services or infrastructure such as roads and transit—will be eliminated or significantly reduced for certain builders.

A staff report indicated this could result in a loss of about $230 million in revenue for Toronto alone.

In the Ontario budget, which was released last week, the province did not provide municipalities with additional funding to help offset either COVID-19 or housing revenue losses. Instead, it committed $48 million in funding for Toronto’s supportive housing costs. Finance Minister Peter Bethlenfalvy said this was the city’s “top request.”

The mayor's office has not confirmed whether this funding was a "top request," saying instead it was a "key funding ask" made by former Mayor John Tory and McKelvie directly to the province.

The funding is part of a larger pledge the Progressive Conservative’s made to provide an additional $202 million each year to the Homeless Prevention Program and Indigenous Supportive Housing Program.

The federal government, for its part, provided municipalities with funding in 2020 and 2021 to offset COVID-19 shortfalls. There was no new funding in the 2023 budget.