The Canadian Taxpayers Federation is calling on the Ontario government to reduce spending and borrowing in light of a new Financial Accountability Office report warning of impending credit downgrades.
“Ontario’s debt has been spiraling out of control since well before the pandemic and the province urgently needs to get government spending under control,” said Jay Goldberg, the CTF’s Interim Ontario Director. “Ontario is the most indebted sub-national unit in the entire world. Every family and business can find ways to save money in tough times and the provincial government needs to do the same thing.”
Ontario’s Financial Accountability Office notes that all four major credit rating agencies have indicated that Ontario’s credit rating will be downgraded if the province continues with the Ford government’s current plan. The Ford government has said it doesn’t intend to balance the budget until at least 2029-30.
“Ontario cannot afford to wait another eight years to balance the budget,” said Goldberg. “The FAO report clearly shows that without taking action sooner, Ontario’s credit rating will be downgraded, which will push debt interest payments even higher.”
This year’s debt interest payment is projected to be $13.1 billion, which is more than the government of Ontario spends on post-secondary education.
The Ford government plans to run a $33-billion deficit this year and forecasts deficits of over $20 billion each for the next two years. By the time the Ford government expects to balance the budget, the provincial debt will have exceeded half a trillion dollars.