No money in federal budget to help fill Toronto's COVID-19 shortfall

There was no money set aside in the federal budget to help Toronto cover a nearly $1 billion COVID-19-related shortfall in its own spending plan.

The city had been hoping that Ottawa would come forward with $235 million in funding to offset 2022 COVID-19 shortfalls, as well as a commitment for hundreds of million more to help it tackle a $933 million shortfall in its 2023 budget due to ongoing COVID-19 costs.

But the budget tabled by Finance Minister Chrystia Freeland on Tuesday afternoon made no such promises.

The provincial budget released last week also failed to include any significant funding for Toronto, other than $48 million to help cover supportive housing costs.

"The 2023 federal budget fails to address the City of Toronto's request for operating budget support,” Deputy Mayor Jennifer McKelvie said in a statement released on Tuesday afternoon. “While I am thankful for past support during the COVID-19 pandemic from the Government of Canada, I'm disappointed the Deputy Prime Minister – a Toronto MP - would ignore a direct commitment the federal Liberals made during the last election to former Mayor John Tory and the City of Toronto.”

The federal government did come forward with funding to help municipalities offset their COVID-19 shortfalls in 2020 and 2021.

McKelvie, however, said that when she spoke with Freeland on Monday she was “very clear” that her government would not be committing to funding ongoing COVID-19 shortfalls.

The deputy mayor did say that Toronto “continues to offer to find an alternative capital ask for housing, transit and climate action equivalent to our 2022 shortfall” but has not yet received any commitments.

“We have been very clear to the Government of Canada what the city's needs are and about the importance of supporting Toronto – the country's economic engine,” McKelvie wrote. “My job right now is to stand up for Toronto and I won't hesitate to fight to make sure our city receives its fair share from the other governments. Our advocacy will continue in the weeks and months ahead.”

Today’s federal budget comes one week after a report from Ernst & Young was released, showing that the city could be facing $46.5 billion in fiscal pressures over the next decade.

That report warned that the city’s financial situation is so dire that its very “fiscal stability and the sustainability of its service levels” will be threatened without action.