The Liberal government will make concessions to the opposition parties when it tables its latest budget Thursday afternoon, but it is unclear whether the NDP will continue to prop up a minority government hampered by controversy over cancelled gas plant costs.
Both Premier Kathleen Wynne and Finance Minister Charles Sousa have said they will table a budget they believe meets enough of the opposition parties’ demands to warrant their support.
But Progressive Conservative Leader Tim Hudak said as early as February that he would not support the governing Liberals’ next budget, arguing that Ontarians need a change in leadership to get the province back on solid financial footing.
Hudak also said this week that the soaring price tag of cancelling the Oakville and Mississauga gas plants ahead of the 2011 election and questions about when the government knew the real costs prove “it’s time for a change.”
That leaves the government’s fate in the hands of NDP Leader Andrea Horwath, who has made it clear that her support for the budget hinges on whether it includes provisions for improving access to home care, boosting youth employment, closing corporate tax loopholes and cutting car insurance premiums by 15 per cent, among other demands.
Earlier this month, the government announced an additional $185 million to reduce wait times for home care among Ontario’s seniors, and $100 million for rural and northern infrastructure.
On Monday, Wynne announced that the budget will also include $295 million in funding over two years to reduce youth unemployment. The money will be divided into four funds, the largest of which will provide wage subsidies to employers who offer jobs and training to youth workers for at least six months.
Two other funds will be devoted to supporting young entrepreneurs, while the fourth will be aimed at skills development.
And on Tuesday, Sousa announced a budget provision aimed at cutting auto insurance premiums by an average of 15 per cent. But it remains unclear whether all drivers in Ontario will benefit, given that insurance premiums are higher in urban centres due to accident and fraud rates.
In making the announcement Tuesday, Sousa said the Liberals have been trying to crack down on insurance rates for the last decade, but also acknowledged the role the NDP played in his government’s latest move.
“I welcome the fact that the third party has also put forward recommendations toward this end,” Sousa told reporters.
“So we have something that we share in common, it’s something that’s going to be good for the people of Ontario, and we’re going to put some teeth into this legislation so we can get this reduction passed on to the people of Ontario and to the drivers.”
On Wednesday, Sousa noted that, “the NDP have made some requests, we’ve met all those requests and much more.”
However, Horwath said she will wait to consult Ontarians about the budget before deciding whether to send them back to the polls.
"Not dissimilar from how we approached the budget last year, it wasn't a matter of a knee jerk thumbs-up or thumbs-down, we're going to take our time and we're going to be very thoughtful about this," Horwath said Wednesday.
"It's a very important decision to be made, and we think Ontarians deserve some sense of the deliberation process, and we need to hear from them."
What is bound to make her decision difficult is that as Sousa was making his goodwill gesture on auto insurance rates, the controversy over the Liberals’ decision to cancel the two gas plants was heating up once again.
Ontario Power Authority CEO Colin Andersen appeared Tuesday morning before a legislative committee that is probing the decision to cancel the gas plants, and suggested the costs of scrapping the Oakville project were eight times higher than the government has suggested.
Andersen told the committee that the latest estimates peg the cost at $310 million, far more than the $40 million the government has insisted represented the full tally. Andersen said the $40 million only represented the “sunk costs,” and that the memorandum of understanding was clear that other costs would emerge.
Andersen said cabinet ministers “knew from the outset that there were going to be additional costs.”
Hours after Andersen testified, Wynne appeared at the committee to say she had nothing to do with the decisions to cancel the plants, and said confusion about the Oakville plant’s costs was the result of the OPA issuing different figures.
The auditor general is probing the cost of cancelling the Oakville plant and his report is expected in late summer. Wynne asked that MPPs wait for that report.
On Wednesday, Hudak said the NDP should ignore the budget goodies and bring down the government.
"I think the NDP have to ask themselves, do they really believe in keeping a government going that has crossed the line towards corruption," Hudak said.
"The NDP comes in the house every day and says that the (Liberals) lied, they're corrupt, they blew all this money. Are they going to then shrug their shoulders and say we're going to keep this act going?”
The gas plant controversy not only threatens to overshadow the goodwill gestures the Liberals have made toward the opposition, but also news that the deficit for 2012-13 will be lower than anticipated.
When he announced the budget date in a speech last week, Sousa said the 2012-13 deficit will be $9.8 billion, lower than the $15.2 billion forecast in last year’s budget and the updated $11.9 billion forecast in January.
Sousa said the new figure would come from “one-time savings,” but said he is still focused on meeting the government’s target of eliminating the deficit by 2017-18.
The finance minister said he would neither “slash and burn” spending in his first budget nor boost spending to unsustainable levels.
With files from The Canadian Press
