As June approaches, the Ontario political parties have begun ramping up for the election. The three big parties that are in the running are the Kathleen Wynne Liberals, the Doug Ford Progressive Conservatives, and the Andrea Horwath NDP. This post is the first of many regarding the provincial election, and will focus on the Liberal Party and their handouts included in the 2018 budget.
As of now, one thing about the upcoming election is obvious; Kathleen Wynne and the Liberal government are desperate to win no matter the cost (literally). In late March, Ontario Finance Minister Charles Sousa announced the Ontario budget for 2018, and it came off more as list of election campaign promises than it did a functional budget. Although the budget was just balanced in 2017, and was originally supposed to stay balanced in 2018, Wynne and Sousa have decided to scrap the idea of remaining out of the red. Now, they plan on running a $6.7 billion deficit in order to pay for the additions to the social welfare system we have in place. I may be cynical about this, but I find it odd that they are adding all of these spending measures at the same time that there is an election in 3 months, and the leader of the provincial government has the lowest approval rating than any other premier in Canada. Wynne currently sits at an extremely low 19% approval rating. It may not be as hilariously low as it was last March (13%), but if they want to win an election, or at the very least hold their official party status, the Ontario Liberals have to work hard to gain the support of disillusioned Ontario citizens.
The 2018 Ontario budget has a spending plan of $158.5 billion, including the $6.7 billion deficit, and no plan for a balanced budget until halfway through the next decade. Because of this, and the irresponsible spending over the last 8 years, the net debt per capita (the debt evenly split between every person of all ages in Ontario) has risen from $14,894 in 2009-10 to a staggering $22,511 in 2018-19. That is outrageous, and the biggest reason that Wynne will likely lose her job as both Ontario Premier and leader of the Ontario Liberal Party when they lose in June.
Before we dive into the campaign-dubbed-budget, Wynne’s government has already been dealt a serious blow following the release of their highly criticized spending plan. Like I just stated, the Liberal government planned on running a $6.7 billion deficit in 2018. However, in a report just completed by the Ontario Auditor General Bonnie Lysyk, it turns out that the provincial government has understated the deficit. The government’s Fair Hydro Plan, which promised to lower the hydro rates in Ontario by 25%, was able to do so by borrowing money in the long-term to reduce the immediate hydro rates. However, due to what the Ontario Finance Minister and Wynne call an “accounting dispute”, the government doesn’t have as much money as it has stated. The lower revenues of power generators due to the Fair Hydro Plan has to be covered by someone, and that someone is actually the Ontario government - and therefore tax payers. As a result, the forecasted provincial deficit has risen by $5 billion in 2018-2019 to $11.7 billion, and by $6 billion in 2020-2021 to $12.5 billion. The same findings were discovered by the Financial Accountability Office’s chief economist David West, who repeated Lysyk’s claim that the Wynne government’s spending is unsustainable. I personally was not surprised when this was discovered. I knew that when the government created the Fair Hydro Plan that it would cost the taxpayers to lower the hydro rates that had skyrocketed because of the Liberal government. Wynne was also a huge supporter of the Justin Trudeau campaign, which promised to run three consecutive $10 billion deficits and a balanced budget in 2019, but has ran two deficits close to $30 billion each. So I’m not at all shocked that Wynne’s government doesn’t know how to accurately calculate a deficit, or just flat out lie to the people of Ontario for her own benefit. And as a taxpayer who has watched the Ontario Liberals as well as the federal ones time and time again lie about spending, I'm more likely to believe both the Financial Accountability Office and the Auditor General over Kathleen Wynne.
In order to help her chances of winning (although people in Ontario are finally aware of the unacceptable spending habits of the current government and aren’t buying these bribes for the most part), Wynne has seemingly decided to change her name to Oprah Wynne-phry. Her budget for the year includes spending $500 million a year on dental coverage for people who do not already have coverage through insurance. The amount per person is $400, and for a family of 4 will be $700 annually. The math there doesn’t exactly add up (4 times $400 equals $1,600), but economic math has never really been a Liberal fortay (note the miscalculated deficit). This also includes prescription drugs for people who do not qualify for the OHIP+ program for people under the age of 25 (even though not all prescriptions are covered in that to begin with, despite how the Liberals advertised it).
The OHIP+ plan will also be expanded to cover “all” prescription pharmaceuticals for people over the of 65. Apparently, this will save the average Ontario senior citizen more than $200 a year. Another $650 million over three years is going to be dedicated to home care for seniors as well. The budget also includes $750 annually to seniors for household maintenance costs, for expenses such as shovelling driveways and mowing lawns. It is an attempt to allow seniors over the age of 75 to remain in their homes, and will cost the province $1 billion over three years. While I think that it sounds good, I believe there could be other ways to have that happen without spending an extra dime. High school students are required to do 40 hours of community service hours in order to graduate, and some high schools require more for special certificates (my high school, R. H. King Academy in Scarborough, required 75 community service hours). The province could change where students are able to serve their hours to helping elderly people maintain their homes, instead of coaching hockey teams for their siblings (I know a lot of people who did this, and it doesn’t help the “community”). That way, the province doesn’t spend money, and the youth can learn a thing or two from the older community, and build bridges in their neighbourhoods.
The province has also said it will dedicate $19 billion over the next ten years to build and renovate hospitals, and add $822 million in operational spending for 2018. Wynne said that the increase in operational spending will help lower wait times, but will not guarantee an end to what some people call “hallway medicine”. The term refers to the amount of patients being treated in the hallways, bathrooms, shower rooms and TV waiting rooms in hospitals. The problem arises from the increasing population of Ontario as compared to the stagnant funding for hospitals, from four and a half thousand elderly people waiting for openings in our crowded nursing homes, and because of the flu filling our waiting rooms more than usual. While the NDP and the Progressive Conservatives both agree that hallway medicine needs to come to an end, they are criticizing the Wynne government for not doing enough. However, both parties have not made clear their intentions with the healthcare sector. Anthony Dale, the president of the Ontario Hospital Association, is glad that there is an increase in funding but has also acknowledged that it will not be enough. Mr. Dale hopes that the winning party in the upcoming election focuses on long-term fixes as well as the short-term. The 2018 budget also includes spending $3.9 billion over the next four years towards mental health and for services for developmentally disabled adults.
That being said, the Wynne government and its McGuinty predecessor are being blamed for the current state of our hospitals. An advocacy group for the estimated 20,000 doctors called Concerned Ontario Doctors (COD) blames the Liberal government(s) for the gross mismanagement of the provincial healthcare system. It claims that over the past decade, especially since 2015, the provincial government has cut a total of 4 billion dollars from front line workers. As a result of the cuts in funding, hospitals have had to close operating rooms and beds, layoffs of nurses, cuts to residency training programs and family medicine teams, and even force early retirements for some physicians. The president of the COD, Dr. Kulvinder Gill, has said that Ontario physicians have not had a contract for nearly seven years, which is unheard of in Canada. The COD also points to the Ontario Financial Accountability Officer report that states the government’s funding of the healthcare system has not been keeping pace with the increase in demand. While the provincial population is going up by 1%, the demand on the healthcare system due to use is increasing by 3%. The cuts done by the Wynne-McGuinty government have put a massive strain on doctors and hospitals, and the COD believes that the $822 million a year increase will only serve as a temporary fix.
The Concerned Ontario Doctors also believes that the government is funding the bureaucracy of the healthcare sector at a cost to the front-line workers. In doing so, the people who are affected the most are the patients due to the increased wait times. Dr. Gill has said that Ontario is a international leader when it comes to healthcare bureaucracy. She says that the only part of the healthcare system that has consistently received funding increases over the past decade are the CEOs, hospital executives, and the local healthcare integration networks (LHIN). The COD also calls for an end to the LHINs, agencies created by the provincial government to coordinate, plan, integrate and fund health services locally. Dr. Gill calls the LHIN in Ontario wasteful. If it is indeed wasteful, I am positive that Doug Ford’s potential audit of the Wynne government will call the Liberal government out for funding such an unnecessary program.
The Liberals have also promised to add $2.2 billion in spending to start giving parents free daycare for kids between the ages of two-and-a-half until they start junior kindergarten. The program would not be started until 2020, and Wynne believes will save parents $17,000 a year. The Liberals want to make raising a child more affordable in Ontario, and are using tax dollars to do it. This has received a lot of criticism from her political opponents, as well as the Ontario public. I personally believe that it isn’t the government’s job to pay for raising a child. Between healthcare, education, and the child benefits that parents already get from the government, it is already enough subsidies. If people want to have a child, they should have to plan ahead financially and wait until they can afford to raise a family. Being a parent comes with a lot of responsibility, as it should. You are raising a tiny human to be a successful, helpful member of society. If all of the fiscal responsibility is taken out of the equation, it will only teach the younger generations that being smart with money isn’t as necessary as it really is. I would rather see that $2.2 billion dollars go towards the public school system (which still has class sizes over 30 kids despite consistent Liberal promises to lower them to 25 or less), or to the healthcare system that I’ve already explained is desperate for more funding.
The promise of socialized daycare also shows that the Wynne government does not want to look at the facts when it comes to the subject. If they had, the government would have seen that the one province that has socialized daycare, Quebec, is worse off because of it. In a 2005 study, and another study done in 2013 that found the same results, researchers discovered that the majority of children were in a worse position than they were before when it came to social and motor skills, aggression, illness, hostile parenting and even parental health. It also showed that there were some people that were not represented in the plan. Due to being well-educated, higher-income, and well-connected families were able to find loopholes in the program to get their child access in a system that had a very high demand and long waiting lists. While the socialized daycare plan did benefit some people who needed it the most, it saw a very large decline for the majority of kids, mostly in middle-class children. Economist Dr. Steven Lehrer, the author of the 2013 study, believed that it also a cause of parents not parenting enough. He said that daycare is too often taken as early education, and parents slack off on important aspects of parenting such as reading to their children. Dr. Lehrer also believes that it is more important to have higher quality daycare spaces, and not higher quantity. He is hoping that provinces that do plan on implementing socialized daycare look at the high quality research that has been completed by looking at the Quebec system.
So, after going over the 2018 Ontario budget, that really comes off more of a campaign platform than a functional budget, I can honestly say that I’m not too pleased with it. I feel that there are billions of dollars going towards programs and initiatives that could be better spent elsewhere. I also feel that it doesn’t do enough to combat the ever-growing debt in Ontario, which is going to hurt us in the not-so-far future. Since 2008, the low interest rate on Ontario’s debt has been pretty incredible. While the government has run deficit after deficit, the spending on our interest hasn’t increased much at all. Unfortunately, our good luck is about to run out. In 2021, the annual spending on our interest rate is going to go up by $2 billion. As of right now, Ontario spends just under $12 billion on interest payments annually, so the increase of $2 billion will bring us to about $13.8 billion a year. The amount we were paying annually in 2017 is the amount that the government spent on the doctors that same year. The government spends $2 billion on the entire Ministry of the Attorney General’s budget, the entire revenue of our tobacco and alcohol sales is $2 billion, and the expected income from the province’s current cap-and-trade carbon pricing scheme is also around $2 billion. So it’s safe to say that a priority of the government should be tackling our insanely high debt and interest rates. Adding more “free” handouts in order to win an election is not going to help Ontario in the long run whatsoever. It isn’t even “in the long run”, as 2021 is only two and a half years away. When it comes to the government, “free” only means that someone else is paying for the service, and that someone else is going to be us in the form of our healthcare, education, and social programs, all of which are not doing as well as they should be.