The 2017 Ontario budget returns the Province to balance for the next two years and reduces the debt-to-GDP ratio. Surprisingly, the overall provincial investment is lower than many expected in social housing. The Province has focused on rising housing prices and rental costs this year. Overall, provincial support for municipalities has increased and progress has been made on the downloading of social services as we approach 2018. The budget mentions the Basic Income Pilot and Community Hubs, but does not provide any new details or funding beyond what has already been announced. 

 

There will be a 2% increase to benefits and some changes to ODSP and Ontario Works this year. The government is also investing $30 million over three years in the Survivors of Domestic Violence Portable Housing Benefit Pilot and $90M to Community Homelessness Prevention Initiatives (CHPI) over the next three years. 

 

The government plans to invest to a total of $190 million into infrastructure by 2024-25 building on new federal investments in public transit. The program started in 2014-15 and has been expanded in both length and total dollars. 

Significant new funding has been dedicated to health care and hospitals in this budget. The biggest surprise in this year's budget was the free drug coverage for youth 24 and under, likely a response to the promise Andrea Horwath made at the recent NDP convention.  

Overall, health care and, to a lesser degree education, were the big winners in this year's budget. Ontario residents can also expect a 25% reduction in their hydro bills by this summer with future increases over the next four years capped at inflation. The 25% includes the removal of the provincial portion of the HST. 

The new spending measures are being funded by better than expected economic growth compared to previous projections and the sale of public assets such as Hydro. 

Below are the Ontario budget highlights for 2017-18:

 

Numbers at a Glance

"...a balanced budget gives us the means to shape our future and build a fairer society"

 

Economic Growth

Last year, Ontario's GDP grew 2.7%. That figure is twice the national average and greater than all G7 countries.

 

This is the first balanced budget since the 2008 recession. The government has reduced the deficit from a high of $19 billion in 2009 to a small surplus $0.6 billion projected for this upcoming fiscal year. The $0.6 billion will be held as a reserve fund to protect against changing economic circumstances. Real estate prices for example has led to a government revenue windfall through the land transfer tax.

 

Ontario deficit history:

An overview on revenue, expenses and debt:

Ontario continues to be concerned about the federal equalization program and receiving their "fair share" from the federal government. Currently Ontario spends the least per-capita on social programs.

 

Ontario has consistently contributed more to the federal government in total tax revenue than the federal government has invested back in Ontario. The Mowat Centre has recently estimated that this shortfall was $7.7B or 1.1% of GDP. The gap has been increasing. In 2017-18, Ontarians are estimated to contribute about $7.1B to fund the equalization program, but the province will receive about $1.4 billion in equalization payments.

 

2017 Budget Contents Relevant to OMSSA members

 

Supporting Municipalities

• Continued progress uploading social assistant benefit costs, as well as court security and prisoner transportation costs since 2003. Downloading costs to municipalities occurred during the Mike Harris years. Overall support for municipalities has increased consistently since 2003.

Affordable Housing and Poverty Reduction

Housing Market and Rent Control

Income Supports and Basic Income

"We're moving forward with a Basic Income Pilot to explore how we can provide more consistent and predictable support to those with low incomes, including those who may be precariously employed. Testing how a Basic Income pilot may improve health, employment and housing outcomes are all part of our efforts to promote a growing economy that benefits all Ontarians." (Quoted from 2017 budget)

• To help improve Ontario Works and the Ontario Disability Support Program, the government is investing more than $480 million over four years to raise asset limits (OW to $10,000 and $15000 for couples. ODSP to $45,000 or for couples $50,000. This takes effect in January 2018), increase income exemptions for cash gifts (now $10,000 for OW and ODSP), and provide a benefit rate increase of 2% that will impact 900,000 people across Ontario. The Personal Needs Allowance for people living in institutions or shelters are included in this. Rate increases will occur in September of 2017 and September of 2018. The Remote Communities Allowance will also be increased by $50 per month for the first person and $25 for each additional family member.

Community Hubs, Education, Early Learning and Child Care

Hydro

Contact Information

If OMSSA members have any additional questions about the provincial budget and details on its contents, please feel free to contact policy analyst Darryl Wolk at 
[email protected] .

 

Personal regards,

 

Darryl Wolk

Policy Analyst