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The CTF vs. Dalton McGuinty:Taxpayers in Court November 15

Author: Tasha Kheiriddin 2004/11/14
On November 15 the Ontario Superior Court and Canadian voters will witness legal history. For the first time in our country, taxpayer protection legislation and a politician's election promise will come before a court of law. The case is that of the Canadian Taxpayers Federation (CTF) and John Williamson, and Greg Sorbara, Dalton McGuinty and the Ontario government.

The lawsuit involves two causes of action. First, the CTF is asking the court to declare that the manner in which the Ontario Health Tax was imposed in last May's provincial budget violates the province's Taxpayer Protection Act (TPA). The TPA prohibits the government from raising certain taxes or imposing new ones without public approval, either through an election or referendum. Yet in 2004 the Liberals imposed the Health Tax without any public mandate whatsoever. Even the government's pre-budget consultations made no mention of the tax. Worse yet, Mr. McGuinty had spent the entire fall 2003 election trumpeting his message of "I won't lower your taxes, but I won't raise them, either." The Liberal leader then took this pledge a step further, by signing the CTF Taxpayer Protection Promise on September 11, 2003, undertaking not to raise taxes or run deficits and to respect the TPA.

This brings us to the second ground of the lawsuit, that of breach of contract. The court is being asked to declare Mr. McGuinty personally in breach of the agreement he signed with the CTF. Since the election, the Premier's public statements have been to the effect that he could not keep the deal because he was blindsided by a deficit of $5.6 billion, as opposed to the $2.2 billion that was expected. While there is no excuse for the previous government's failings, there is evidence, which the CTF has introduced into court, suggesting the Liberals knew the real size of the deficit before the election. Yet Mr. McGuinty still signed the CTF's Taxpayer Protection Promise. He knew he needed to demonstrate fiscal prudence to win the election - and he used the CTF contract to do it.

Some may say that a court of law is no place to take a broken political promise. Unfortunately, in our current system, the CTF had little choice. There are no other mechanisms in Ontario to hold politicians accountable between elections. What this case reveals is the need for recall and referendum laws, such as those in British Columbia and many U.S. states. B.C. has already seen one MLA, Paul Reitsma, resign as a result of a recall petition. Voters also came within 500 signatures on a petition seeking to recall then-NDP cabinet minister Paul Ramsey. And few need reminding about the recall of Governor Gray Davis in California. While these laws may not be used often, the very threat can be enough to make politicians think twice about taking the electorate for granted.

Whatever the court's decision, the CTF believes it must take a stand on behalf of taxpayers, and have our courts pronounce on the legality of the Health Tax and the validity of Mr. McGuinty's promise to Ontario voters. If existing taxpayer protection laws do not protect taxpayers, then they need to be strengthened. If politicians cannot be held accountable for their promises, then the public need other means to hold them to account. For if politicians can get away with lying to win elections, then we will only end up being told more lies. Let's remind our elected officials that taxpayers are the ones who underwrite government, and not the other way around.

Tasha Kheiriddin
CTF Ontario Director

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