Ontario’s Minister of Finance Vic Fedeli
We shouldn’t kid ourselves and believe for one second that the previous Wynne Liberal government was trying to get its fiscal house in order.
Or that, as some irrationally suggest, that the province’s fiscal challenges have been wildly exaggerated.
The reality is Ontario needs to balance competing needs to find money to fund existing public services, to improve those services, reduce our crushing debt and deficit, and build for the future by investing in desperately needed infrastructure like subways, schools and hospitals.
The actual fiction is to imagine we can do all of that while continuing to live on the taxpayer credit card, while accumulating an ever growing mountain of interest. Or that we can achieve our collective goals without the need to find a few pennies in savings from every dollar this province spends.
For too long, too many have been in a state of fiscal denial over Ontario’s finances.
This province’s NDP and Liberal opposition parties didn’t see debt or deficits as a problem. Kathleen Wynne planned $32 billion in deficit accumulation which included new tax and user fee hikes had she been elected. Unfortunately for everyone in Ontario she governed as if money grew on trees.
The Liberals spent about $40 million a day more than they collected in revenue. Government spending doubled under the Liberals from about $82 billion in 2003 to over $150 billion by the time they left office. Net debt more than doubled to $343 billion under the Liberals. NDP leader Andrea Horwath almost certainly would have taxed and spent even more.
The fiscal hangover from the previous government’s spending spree is over $13 billion in debt interest this fiscal year and growing, now the fourth largest spend in the Ontario budget and not a penny of that goes to hospitals, schools, transit, seniors or other services. We are the most indebted sub-sovereign jurisdiction on the entire planet.
But it’s not just opposition politicians in fiscal denial. Public sector unions, interest groups that represent vast and varied interests, and increasingly, many in the media have jumped onto the debt bandwagon.
Even the once-fiscally sensible Globe & Mail, whose editorial board sounded the alarm bell for years on the deteriorating state of Ontario’s finances, has suddenly and seemingly embraced the irrational logic of perpetual deficit financing, preferring to ignore the inconvenient realities and consequences of fiscal irresponsibility.
Under the Liberals, our province saw credit rating downgrade after downgrade, which increased borrowing costs and undermined investment in this province. Last month, for the first time in three years, a major bond rating agency, Fitch, improved Ontario’s credit rating outlook from “negative” to “stable,” so we know we’re now moving in the right direction.
Those who deny Ontario’s fiscal reality want government to have its cake and eat it too, not only during bad times, but every day of week.
They ignore the fact that the “cake” eaten today will be paid for by tomorrow’s taxpayers, and left unchecked, interest payments on debt costs will crowd out funding for the critical services people rely on every day, like health care, education and social services.
Ask yourself whether Ontario’s public services improved or declined during the spending boom of the past decade? Ask yourself why hallway health care flourished, why waitlists grew for those who needed social housing and long-term care beds, why student performance slumped, why promises of new subways and other needed infrastructure translated into little action, and why those who most needed help were too often denied the help they needed.
Our government has charted a prudent and responsible path to balance that will improve services, eliminate the deficit, reduce the debt burden, and build for the future.
We need all of our partners, including municipalities, school boards, health care and public sector employers and workers, to do their part to help find savings. That is the only way we are going to get Ontario back on its feet, and provide help to those who need help most.
