2011 Ontario Budget Analysis

2011 Ontario Budget Analysis – Fleishman-Hillard has prepared an overview of the measures contained in the Ontario budget tabled March 29 by Finance Minister Dwight Duncan.

 
The Diva Politica

Overview

The budget delivered by Ontario Finance Minister Dwight Duncan today contains one big message aimed at voters, in anticipation of this fall’s election.

Building on the messaging contained in the Minister’s speech to the Toronto Board of Trade last week, today’s budget positions the government as prudent – one that is focused on eliminating the deficit in due course while safeguarding education and healthcare.

There isn’t a lot of new spending contained in the budget – beyond the initiatives reported in the media in recent days around increased funding for post-secondary education, and breast cancer screening, and a mental health and addictions strategy that will be targeted initially at children and youth.

In fact, in order to show it means business in terms of trimming the deficit, the government intends to keep increases in total program spending to an average annual rate of 1.7 per cent between 2010/2011 and 2013/2014.

This represents half the average annual rate of increase projected for revenues. And in the same vein (and as anticipated), the budget confirms that the deficit for 2010/2011 is projected to be $16.7 billion – $3 billion lower than thought a year ago, largely attributed to lower program spending.

What is news is the announcement of a Commission on Broader Public Sector Reform. This initiative is positioned as central to eliminating the deficit while protecting education and health care. The Commission will be led by Don Drummond (one of the main architects of the federal budget for years), who will be tasked with recommending long-term, fundamental changes to the way government works. Drummond’s mandate will be restricted – his recommendations cannot contemplate increased taxes or lead to the privatization of health care or education.

By ruling out new major tax cuts (such as a decrease in the HST), the budget therefore attempts to position the fall election as a choice between prudent management and what it argues would be across-the-board cuts needed in order to finance such a cut.

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