Ontario’s deficit figure is changing again as Finance Minister Vic Fedeli says higher tax revenue is expected to shrink the annual shortfall by $1 billion in the fiscal year ending March 31.
An unexpected windfall from corporate income taxes and higher consumer spending through the HST in the third quarter should reduce the annual shortfall to $13.5 billion, Fedeli said Wednesday, improving on a forecast $14.5 billion deficit in his November economic statement.
“Thanks to stronger economic growth…Ontario’s revenue position has improved,” he told a news conference, crediting the “open for business” agenda of Progressive Conservative Premier Doug Ford’s government.
Liberal MPP Mitzie Hunter (Scarborough-Guildwood) cast doubt upon the deficit number, charging it is “inflated…to justify an austerity agenda” as the Conservatives work to fulfil a promise of $6 billion a year in spending cuts with Fedeli’s spring budget approaching.
“Both the Financial Accountability Office and the previous provincial comptroller dispute the government’s numbers. This is no small thing,” added Hunter, her party’s finance critic.
The independent FAO headed by Peter Weltman put Ontario’s deficit at $12.3 billion in a December report — $1.2 billion lower than Fedeli projected at the time — saying the government’s forecast of tax revenue was on the low side. Fedeli said that was because he was being prudent.
Cindy Veinot, the provincial controller who quit in September because she said she “did not agree with accounting decisions made by the current government,” has maintained the deficit figure could be as much as $5 billion lower than Fedeli’s estimate.
That’s because the new government, unlike its Liberal predecessor, no longer counts $11 billion in co-sponsored Ontario Public Service Employees’ Union Pension Plan and the Ontario Teachers’ Pension Plan assets on the provincial bottom line.