Ford’s secret surplus should be here to stay

Author: Jay Goldberg 2022/10/15

Well, I was wrong when I projected it would take Premier Doug Ford two years to balance the budget.

It’s already balanced.

But here’s the funny thing: he doesn’t want you to know about it.

A two-year timeframe seemed optimistic just a few months ago. That was based on a report released by Ontario’s Financial Accountability Office, the province’s budgetary watchdog agency. The FAO’s report showed the Ford government could balance the books within two years by simply limiting spending increases to rate of inflation.

Even without genuine spending restraint, the FAO said Ontario was on a path to balance, largely because of increased tax revenue driven by inflation.

A week after the FAO issued its report, Finance Minister Peter Bethlenfalvy released the Ford government’s 2022 budget. It announced plans to run the largest deficit in Ontario’s history and the government wouldn’t balance the books for at least five years.

Even with an inflation cash windfall, the Ford government planned to run a stunning $19.9-billion deficit.

Despite running on a platform of fiscal discipline in the 2018 provincial election, the Ford government told Ontarians that the province’s finances were awash in red ink.

Fast forward to the end of September. On a Friday afternoon, without any fanfare, the Ford government released last year’s public accounts. They show the government actually balanced the budget in fiscal year 2021-22.

This was Ontario’s first balanced budget in 14 years.

For most governments, this would be a huge accomplishment. For the Ford government, it was news to slip out on a Friday afternoon and hope nobody noticed.

The real headline should have been the fact that revenue in Ontario was $31.1 billion higher than the government expected.

In the president of the treasury board’s foreword on the public accounts, the government appeared pained to even admit there was a surplus.

“The surplus recorded in the 2021-22 Public Accounts is not necessarily indicative of future results,” read the statement. “We cannot build a prudent and responsible long-term fiscal plan based on short-term, and uncertain, economic circumstances.”

But with government revenue $31.1 billion higher than the Ford team had expected, in large part due to inflation, now is exactly the time to ensure the budget remains balanced over the long term.

Clearly, the Ford government doesn’t want to raise expectations. It doesn’t want to acknowledge the surplus. It’s as if Ford is already preparing to plunge the province back into deficit.

But, with government revenue $31.1 billion beyond the government’s expectations, it would be a dereliction of duty for Ford to steer the province back into deficit.

All of this extra tax revenue proves it’s time for the Ford government to reduce the heavy tax burden on Ontario taxpayers.

The Ford government should use its cash windfall both to keep the budget balanced and reduce taxes.

And the government should start by making its temporary gas tax cut permanent.

A permanent tax cut could easily be paid for without impacting the province’s bottom line. Ford could start by stopping corporate welfare handouts.

Just a few months ago, Ford handed Stellantis, a Fortune 500 company, over half a billion dollars for plant renovations in Windsor and Brampton. It’s time to stop giving taxpayer dollars to companies that don’t need the help.

It turns out a two-year path to a balanced budget was too pessimistic. The government has already balanced the books. But taxpayers need to stay vigilant and demand that Ford use the revenue windfall to maintain a balanced budget, not to plunge the province back into a sea of deficit spending.

It took Ontario 14 years to get to this balanced budget moment and taxpayers cannot allow Ford to throw it away.

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