This past week, the Government of Ontario released its budget plan that projects budget deficits for the foreseeable future. This year a $33.1 billion deficit is planned, which is $5 billion less than last year’s deficit.
According to Steve Clark MPP for Leeds-Grenville-Thousand Islands and Rideau Lakes, and Minister of Municipal Affairs and Housing, “Ontario is projecting a $38.5 billion deficit in 2020–21. Over the medium term, the government projects steadily declining deficits of $33.1 billion in 2021–22, $27.7 billion in 2022–23 and $20.2 billion in 2023–24. In order to provide transparency about the high degree of economic uncertainty, the 2021 Budget includes Faster Growth and Slower Growth scenarios that the economy could take over the next several years and illustrates the possible impacts on Ontario’s finances.”
The budget contains $186.1 billion in spending, with $6.7 billion, which is a little less than last year, earmarked for pandemic-related measures. There will be $166.3 billion in overall program spending.
Some of the highlights of this budget are in health care, with expanded spending including, $1.8 billion on hospital services this year; that will include $760 million for hospital beds and $300 million to clear the backlog of procedures that has built up during pandemic-related shutdowns. The vaccine rollout plan will cost $1 billion, and there will be $2.3 billion for expanded COVID-19 testing; $933 million will go to expanding Long Term Care spaces.
The provincial government is introducing new tax credits and expanding existing ones including the Regional Opportunities Investment Tax Credit, which is intended to encourage business investments.
The budget plan also includes a new Ontario Jobs Training Tax Credit, which would provide up to $2,000 per recipient to cover half of eligible expenses, which include college and technical qualifications or training programs. The government is also offering grants to small businesses through the Ontario Small Business Support Grant. Small tourism-related businesses will be eligible for a new grant of as much as $20,000 through a new program to support businesses that have been among the hardest-hit in the pandemic.
There will be a temporary top up in the Childcare Access and Relief from Expense (CARE) tax credit to increase the amount of financial assistance available to families with large child-care expenses. Families with children in schools will be eligible for $400 per child and $500 for people under 21 with a learning disability.
There will also be investments in broadband internet services across the province, where the government is adding $2.8 billion. There is $5 million for a study of returning rail service from Toronto to Cochrane.
MPP Steve Clark noted that the budget also contains funding for a new treatment Centre for the Children’s Hospital of Eastern Ontario.
“People in our community have been making sacrifices to help us reach the day when the pandemic is behind us,” said Steve Clark. “Our government will continue to be there every step of the way to protect people’s health and jobs. Working together, we will unleash the economic growth that is necessary for job creation, prosperity and a stronger province.”
To help the thousands of people struggling with mental health and addictions issues, Ontario is providing additional funding of $175 million in 2021–22 as part of a historic investment of $3.8 billion over 10 years, to provide more and better care for everyone who needs it. Ontario is investing an additional $400 million over the next three years in new tourism and hospitality initiatives to support these sectors.
Highlights of Ontario’s plan to support communities:
- To support faith-based and cultural organizations that are struggling due to the additional costs caused by COVID-19, Ontario will be making up to $50 million available for grants to eligible organizations.
- To support Ontario’s 444 municipalities, the Province’s key partners in the fight against COVID-19, the government is providing almost $1 billion in additional financial relief in 2021 to help preserve vital public services and support economic recovery.
Like economies around the world, Ontario has been significantly impacted by the COVID-19 pandemic. The province’s real gross domestic product (GDP) is estimated to have declined by 5.7 per cent in 2020. As the economy recovers, Ontario’s real GDP and employment are both forecast to surpass their pre-pandemic levels in early 2022.