Ontario unlikely to balance budget by 2030 despite post-pandemic growth: report
Ontario's fiscal watchdog says the province's economy will rebound over the next two years but the government is unlikely to reach its goal of a balanced budget by the start of the next decade.
The Financial Accountability Office released a report on the province's spring economic and budget outlook today, assessing the financial picture as the province starts to emerge from the pandemic.
If COVID-19 vaccine distribution goes ahead as planned and the pandemic subsides, the report projects real gross domestic product will rise by 5.8 per cent this year and four per cent next year.
But the FAO said economic growth could be slower if public health measures and vaccinations fail to contain a resurgence of the virus.
"The path to economic recovery in 2021 depends heavily on the success of the federal and provincial governments' plans for the COVID-19 vaccine distribution," the report said.
"There are challenges related to the rise of variant COVID-19 cases, noncompliance with public health guidelines and vaccine hesitancy."
The report also found that under current policies, the Progressive Conservative government won't balance its books by 2029-2030 as proposed in this year's budget.
The FAO said the budget didn't provide details on how the province would achieve the required $17.8 billion in permanent cost savings to reach that goal.
"To achieve its recovery plan, the government would have to introduce new program changes that lower spending by $1,281 per Ontarian by 2029--30 in 2020 dollars," the report said.
Financial Accountability Officer Peter Weltman said his office chose to look at that lengthy timeline based the government's own targets, and noted that a "lot can change" between now and 2030.
"As long as program spending exceeds revenues, the budget will never get back to balance, but we can't obviously look that far out," he said.
The report also flagged that future revenue forecast in the budget is lower than the government's economic outlook, suggesting possible unannounced tax cuts in the future.
NDP Leader Andrea Horwath said it's "alarming" that $17.8 billion in cuts would be required to get to the balanced budget goal. She said people will need services in the coming years to recover from the pandemic.
"This is a warning siren: more big cuts and bad choices are on the way," she said.
"Everyday families will pay the price for (Premier Doug Ford)'s slash-and-burn agenda. You can't cut $17.8-billion without hurting them deeply.""
This report by The Canadian Press was first published June 10, 2021.
CTVNews.ca Top Stories
Documents reveal Ottawa's efforts to get Loblaw, Walmart on board with grocery code
It was evident to the federal government as early as last fall that Loblaw and Walmart might be holdouts to the grocery code of conduct, jeopardizing the project's success.
opinion The special relationship between King Charles and the Princess of Wales
Royal commentator Afua Hagan writes that when King Charles recently admitted Catherine to the Order of the Companions of Honour, it not only made history, but it reinforced the strong bond between the King and his beloved daughter-in-law.
'I just want to be safe': Ukrainian man in Canada faces limbo amid consular freeze
A recent decision to restrict consular services for fighting-aged Ukrainian men has made a Ukrainian man in Canada feel less certain of his next steps — and worried he could be pulled back to the war.
Dozens of U.S. deaths reveal risks of injecting sedatives into people restrained by police
The practice of giving sedatives to people detained by police has spread quietly across the U.S. over the last 15 years, built on questionable science and backed by police-aligned experts, an investigation led by The Associated Press has found.
Improve balance and build core strength with this exercise
When it comes to cardiovascular fitness, you may tend to focus on activities that move you forward, such as walking, running and cycling.
Expert warns of food consumption habits amid rising prices
A new survey by Dalhousie University's Agri-Food Analytics Lab asked Canadians about their food consumption habits amid rising prices.
Charlie Woods, son of Tiger, shoots 81 in U.S. Open qualifier
Charlie Woods failed to advance in a U.S. Open local qualifying event Thursday, shooting a 9-over 81 at Legacy Golf & Tennis Club.
B.C. tenants evicted for landlord's use after refusing large rent increase to take over neighbouring suite
Ashley Dickey and her mother rented part of the same Coquitlam duplex in three different decades under three different landlords.
Mountain guide dies after falling into a crevasse in Banff National Park
A man who fell into a crevasse while leading a backcountry ski group deep in the Canadian Rockies has died.