2019 Ontario Budget Update

This afternoon, Ontario Finance Minister Vic Fedeli released the Ford Government’s first Budget, Protecting What Matters Most. Budget 2019 paints the most fulsome statement to date of the vision the Ford Tories have for Ontario.

Cleaning Up Ontario’s Balance Sheet

While eliminating the deficit and bringing down Ontario’s $343 billion debt are central focuses for the new government, they will not be repeating the slash-and-burn approach of previous Conservatives in the 90s.  Instead the budget takes a relatively modest path to bring Ontario’s budget back to balance by 2023-24. The plan will cap new spending at 1 per cent per year, matched with an expected 3 per cent annual increase in revenues. The budget also predicts that Ontario’s GDP will remain relatively gloomy at under 2 per cent GDP growth for the foreseeable future. Above this, all Ministries have been tasked with finding efficiencies of 4 per cent across the board by 2023-24. While tough decisions will undoubtedly have to be made, this plan is certainly more balanced than some anticipated, and it recognizes that reducing the quality or availability of government services is not a winning path for Ontario.

Digital First For Government

To find efficiencies, the Budget takes an overdue step by declaring all government services will be “digital first.” It notes that the initial focus of this vision will shifting all government services online and improving the online user experience for the top ten services delivered by ServiceOntario. This is a needed first step and shows this government understands that digital approaches can reduce costs while improving citizen outcomes. However, the remainder of the plan for how the “Digital First” approach can apply to all outward facing and back office operations still needs to be built out in more detail. Like all Ministries, the Ministry of Government and Consumer Services, which leads IT service delivery in the Ontario Government, is seeing their year-over-year funding reduced. While efficiencies can absolutely be found in the IT stack, hopefully the Government will still retain flexibility to invest in technologies that will enable all areas of government to drive the Digital First Vision forward. 

Healthcare

The Digital First vision also expands to healthcare, with a commitment to increase virtual care and give Ontarians more digital tools to access their personal health information. They’re also experimenting with new, integrated care models through MyHealthTeam and services like transitional care spaces, so patients can leave the hospital but still receive some care before returning home. The Government is also creating a Centre of Excellence for Mental Health and Addictions Services.

Transit for the Future

The Budget sets out a new vision to expand transit for commuters. This includes an $11.2 billion commitment to four new rapid transit lines in the Greater Toronto Area (GTA), including the Ontario Line as an alternative to the long planned Downtown Relief Line. The Budget also commits $1.2 billion to expand Ottawa’s O-Train network, and $1 billion for 14 km of light rail in Hamilton. The Government also plans to launch the next major expansion of the GO Train network in 2019, with Metrolinx launching critical procurements.

Auto Insurance Innovation

For decades Ontario has been trying to reduce auto insurance costs. The Government is taking a new approach by removing regulatory barriers that inhibit innovation in the industry. They plan to introduce amendments that will give companies greater flexibility in how they offer discounts (e.g. allowing discounts for good credit ratings or getting service at a particular garage), or allowing different coverage models, like pay-as-you-go. At a time when more Ontarians are opting not to own cars, opening the rules for innovation could spur new business models for car sharing and ownership. Changes will also allow for electronic proof of insurance.

Sin for the Win

Some of the biggest headlines from the Budget will be focused on changes to Ontario’s dated approach to alcohol and gambling. Apparently, Ontarians have among the fewest points of sale for alcohol per capita in the country. The Budget announced legislative changes that will expand the availability of alcohol to corner stores, grocery stores and big box stores, while also allowing adults to drink in public, at select tail gate parties and in public parks or other areas, depending on municipalities sign off. The Government will also legalize online gambling and betting on single sports events – a move that has been supported by every major sports league.

Other Highlights

  • The Government will introduce legislation allowing the hunting of the double-crested cormorant.
  • Ontario will modernize the governance of amateur combat sports – bringing more sport karate tournaments to the province.
  • Ontario is anticipating cannabis revenues to jump from $70 million to $80 million by 2022.