Annex I: Fiscal Outlook
Section A | Ontario’s 2008–09 Fiscal Outlook
In the current environment of heightened economic uncertainty, many international jurisdictions face an unparalleled economic crisis as slowing economies result in lower revenue growth. Ontario is no exception. The Province’s 2008–09 revenue is currently projected to decline by 1.2 per cent compared to 2007–08 — the first time Provincial revenues have declined since 2003–04. This projected decline in revenue, combined with increased spending on health, has resulted in a forecasted deficit of $500 million for 2008–09, which represents 0.5 per cent of the 2008–09 revenue outlook.
This government has successfully eliminated deficits in the past. The $5.5 billion deficit inherited in 2003–04 was eliminated within two years. The government then posted three consecutive surpluses. This prudent fiscal management of Ontario’s finances was achieved while investing in key priorities. These actions have strengthened Ontario’s economic advantage and prepared the province for the current economic downturn. The projected deficit in 2008–09 is a clear indication of the government’s commitment to do everything it can to protect these investments.
The government continues to strengthen the economy through its five-point economic plan to invest in skills and knowledge; invest in infrastructure; lower business costs; strengthen the environment for innovation; and form key partnerships to strengthen Ontario. Recognizing the current economic uncertainty, the government will continue to maintain a cautious and prudent fiscal plan, including a reserve and contingency funds, while taking immediate action to manage expense growth.
This Annex provides an update on the fiscal outlook for 2008–09. The government continues to monitor risks to Ontario’s economic and fiscal situation closely, and will update Ontario’s medium-term fiscal plan and outlook in the 2009 Budget.
2008–09 Fiscal Performance
The 2008–09 First Quarter Ontario Finances noted that the consensus forecast predicted slower economic growth for Ontario than was projected in the 2008 Budget but that it was still too early to determine the effect on the Province’s revenue and expense outlook. The current fiscal outlook reflects the estimated impact of these economic risks and modifies the outlook projected in the 2008 Ontario Budget.
| Budget Plan | Current Outlook | In-Year Change | |
|---|---|---|---|
| Revenue | 96,920 | 96,002 | (918) |
| Expense | |||
| Programs | 87,279 | 87,411 | 132 |
| Interest on Debt | 8,891 | 8,891 | – |
| Total Expense | 96,170 | 96,302 | 132 |
| Reserve | 750 | 200 | (550) |
| Surplus/(Deficit) | 0 | (500) | (500) |
Total revenue in 2008–09 is currently projected to be $96,002 million, a decrease of 0.9 per cent from the 2008 Budget forecast, reflecting projections for slower economic growth. Total expense in 2008–09 is currently estimated to be $96,302 million, 0.1 per cent higher than the 2008 Budget forecast, primarily due to higher utilization-related expense in the Ontario Health Insurance Plan (OHIP) program.
The 2008 Budget plan included prudence in the form of a $750 million reserve in 2008–09 to protect against adverse changes in the Province’s revenue and expense, including those resulting from changes in Ontario’s economic performance. A portion of the reserve has been drawn down to partially offset the effects of slower economic growth on the Province’s fiscal outlook. The Province continues to maintain a $200 million reserve in recognition of the continued global economic uncertainty that could further impact the Province’s finances.
2008–09 Revenue Changes SINCE 2008 BUDGET
The revenue outlook at $96,002 million has decreased by $918 million from the 2008 Budget forecast, largely reflecting slower economic growth projections for 2008, partially offset by higher Government of Canada transfers.
| Taxation Revenue Changes | ||
|---|---|---|
| Corporations Tax | (880) | |
| Land Transfer Tax | (180) | |
| Gasoline Tax | (65) | |
| Total Taxation Revenue Changes | (1,125) | |
| Changes in Government of Canada Transfers | ||
| Infrastructure Programs | 25 | |
| All Other Government of Canada | 182 | |
| Total Changes in Government of Canada Transfers | 207 | |
| Total Revenue Changes Since 2008 Budget | (918) |
Details of 2008–09 In-Year Revenue Changes
Key revenue changes include the following:
- Corporations Tax revenues are projected to be $880 million below the 2008 Budget projection, mainly due to slower projected 2008 corporate profit growth.
- Land Transfer Tax revenues are forecast to decline by $180 million, reflecting a weaker resale housing market than projected in the 2008 Budget.
- Gasoline Tax revenue is projected to be $65 million lower than forecast in the 2008 Budget due to lower gasoline consumption resulting from higher gasoline pump prices.
- The $207 million increase in Government of Canada Transfers is mainly due to:
- $25 million in federal funding, related to the Building Canada Plan, which will be received in 2008–09 instead of 2007–08, as the infrastructure framework agreement was signed on July 24, 2008;
- $150 million federal payment related to corporate tax harmonization being recorded in 2008–09 rather than 2007–08; and
- $31 million in funding under the Police Officers Recruitment Fund, which was not previously booked by the Province pending decisions on use of the funds. This amount is offset by an equivalent increase in expense as noted below.
2008–09 Expense CHANGEs SINCE 2008 BUDGET
Total expense in 2008–09 is currently projected to be $96,302 million, an increase of $132 million from the 2008 Budget forecast. This change in total expense primarily reflects an increase in the Ministry of Health and Long-Term Care for utilization-related expense in the OHIP program.
| Program Expense Changes with Contingency Fund Offsets This Quarter | ||
|---|---|---|
| Ministry of Education – School Boards' Net Expense – Grants for Student Needs funding. | 187.5 | |
| Other Changes in Program Expense with Contingency Fund Offsets – mainly funding for flood relief response and repairs, and for the OMERS Administration Corporation. | 7.1 | |
| Ministry of Finance – Operating Contingency Fund offsets | (191.5) | |
| Ministry of Energy and Infrastructure – Capital Contingency Fund offsets | (3.1) | |
| Net Program Expense Changes with Contingency Fund Offsets This Quarter | – | |
| Additional Changes in Program Expense This Quarter | ||
| Ministry of Health and Long-Term Care – utilization-related expense in the OHIP program. | 100 | |
| Ministry of Community Safety and Correctional Services – increase to support recruitment of police officers. | 31 | |
| Other Changes in Program Expense – primarily reflects funding for college training equipment. | 1.1 | |
| Total Additional Changes in Program Expense This Quarter | 132 | |
| Net Changes in Program Expense Reported in First Quarter Ontario Finances | – | |
| Interest on Debt Changes | – | |
| Total Expense Changes Since 2008 Budget | 132 |
Details of 2008–09 In-Year Expense Changes
The following expense changes have occurred since the 2008–09 First Quarter Ontario Finances:
Program Expense Changes with Contingency Fund Offsets:
- An increase of $187.5 million in the Ministry of Education School Boards’ Net Expense to enhance Grants for Student Needs funding to support salary benchmark increases for education sector staff.
- Other Changes in Program Expense with Contingency Fund Offsets reflect a net increase of $7.1 million, which includes funding for flood relief services and repairs, and a one-time payment for the OMERS Administration Corporation to administer supplemental benefit plans.
The Operating Contingency Fund has decreased by $191.5 million, and the Capital Contingency Fund has decreased by $3.1 million, to fund ministries’ expense changes as outlined.
Additional Changes in Program Expense:
- An increase of $100.0 million in the Ministry of Health and Long-Term Care due to higher utilization-related expense in the OHIP program.
- An increase of $31.0 million in the Ministry of Community Safety and Correctional Services, fully offset by federal revenue from the Police Officers Recruitment Fund announced in the 2008 federal budget. This federal transfer provides partial support for the recruitment of police officers to make communities safer.
- An increase of $1.1 million in Other Changes in Program Expense, primarily due to funding for college training equipment, fully offset by federal revenue.
Maintaining a Prudent accumulated deficit-to-GDP ratio
A key element of the government’s fiscal plan is the commitment to maintain a prudent level of accumulated deficit relative to the size of Ontario’s economy as measured by nominal gross domestic product (GDP). This contributes to responsible fiscal management that is long term in nature, so that future generations are not faced with the erosion of key programs and services.
Although a $500 million deficit is forecast for 2008–09, the Province’s accumulated deficit-to-GDP ratio is projected to improve to 17.8 per cent in 2008–09, down from 25.2 per cent in 2003–04.
This year’s deficit is primarily the result of lower revenue growth due to heightened economic uncertainty, and is a clear indication of the government’s commitment to do everything it can to protect investments in key public services.
Consistent with this approach, the government continues to pursue strategies to contain spending while doing all it can to protect key investments.
Risks TO the Fiscal outlook
Like many jurisdictions around the world, Ontario faces a much more challenging economic environment than both public and private forecasters expected at the time of the 2008 Budget. As a result, the Province’s fiscal outlook is increasingly vulnerable to variances in both the revenue and expense outlooks. In particular, revenue risks are greater due to heightened global economic and financial uncertainty. Key cost drivers within the Province’s expense outlook could also be affected, including pressures in demand-driven programs and services that arise from changes in the economic outlook, utilization or enrolment rates. Although the $750 million reserve included in the 2008 Budget has been adjusted to offset a lower revenue outlook, prudence remains in the fiscal plan in the form of a reserve and contingency funds to help mitigate further changes arising from global economic uncertainty that could have an adverse impact on the Province’s overall fiscal performance.
While the current outlook for Ontario’s revenues has declined by $918 million, risks that could have additional impacts on the revenue outlook for 2008–09 remain. In particular, ongoing developments in the world economy and financial markets could affect Ontario’s overall economic performance. As well, as in past years, the revenue outlook could change as past years’ tax return processing is finalized over the coming months. Corporations Tax revenues are subject to the greatest uncertainty, as these historically fluctuate considerably and information arriving late in the fiscal year can result in substantial changes to the outlook.
Risks to the expense outlook are especially evident in the health, education and social services sectors, which account for over two-thirds of total Provincial expense, and include assumptions about expected utilization, enrolment rates and caseloads, many of which are demand-driven and impacted by changes in Ontario’s economic performance. For example, a one per cent increase in both Ontario Works and Ontario Disability Support Program caseloads would cost the Province an additional $46 million a year.
Compensation costs and wage settlements, together with the investment performance of pension plans, are also key cost elements and could have a substantial impact on the finances of both broader public-sector (BPS) partners and the Province. With major contracts covering over 50 per cent of unionized workers in the BPS and approximately 85 per cent of employees in the Ontario Public Service (OPS) up for negotiation in 2008–09, the government will expect its bargaining agent partners in this new fiscal environment to achieve affordable agreements.
As the factors and assumptions comprising the revenue and expense forecasts interact and shift, fiscal and economic updates at various times of the fiscal cycle may include adjustments to the revenue and expense forecasts to reflect these changes. For example, a change of one per cent to total revenue or total expense in 2008–09 represents close to a $1.0 billion change in the Province’s overall fiscal outlook. While this change may be small relative to the government’s $96 billion budget, it can cause significant swings in the Province’s surplus/deficit.
As part of its ongoing plan to prudently manage the Province’s finances in the face of risks arising from global economic uncertainty, the government continues to pursue strategies to contain spending while doing everything it can to protect investments in key public services. This expenditure management includes delaying the implementation of and slowing down some new initiatives, undertaking a number of discretionary restraint initiatives that will realize savings, and requiring ministries to focus on the highest-priority programs and services through the results-based planning process. The 2008–09 fiscal plan also continues to maintain a cautious and prudent approach to fiscal planning, including a reserve and contingency funds.
Given global economic uncertainty, the government’s immediate priority is to provide a fiscal update for 2008–09. The government continues to monitor Ontario’s economic and fiscal situation closely, and will provide details about Ontario’s medium-term fiscal plan and outlook in the 2009 Budget.
Detailed information on revenue and expense risks and sensitivities, including compensation costs, can be found in Chapter II of the 2008 Ontario Budget, Sections D and E respectively.
Section B | Expenditure Management
The government has demonstrated its commitment to the prudent management of the Province’s finances. To improve delivery of public services while managing growth in spending, the government has achieved efficiencies across the Ontario Public Service (OPS). Reportable savings of $806 million were identified over the 2004–05 to 2007–08 period, exceeding the target of $750 million. Savings were made possible through streamlined purchasing processes; reduced administrative costs; reduced energy and accommodation costs; improved use of information technology; and better harmonization and coordination of government operations.
The Province’s commitment to finding efficiencies has reduced the overall cost of government administration from 15 per cent in 2003–04 to 12 per cent in 2007–08. In addition, Ontario’s spending on general government services was $124 per person in 2007–08 — the second-lowest rate among all provincial governments.
The government continues to pursue strategies to contain spending while doing everything it can to protect key public services that people depend on.
The government is taking action to manage its expenses in light of lower revenues and to provide fiscal flexibility. It is:
- Delaying the implementation of and slowing down some new initiatives. Further information is available in materials released in conjunction with the 2008 Ontario Economic Outlook and Fiscal Review.
- Undertaking a number of discretionary restraint initiatives that will realize savings, including restrictions on government travel, consulting services, information technology and accommodation spending.
- Requiring ministries through the 2009–10 results-based planning process to focus on the highest-priority programs and services while ensuring lower-priority programs are reviewed and assessed to look for improvements.
The Minister of Finance will continue to consult with Ontarians and other key groups and individuals to discuss how the Province can continue to manage expenses and do everything it can to protect key public services.
As Ontario faces these global economic conditions, the government is asking its Broader Public Sector (BPS) partners to help it in meeting these challenges. Broader Public Sector employers, as well as the OPS, face a heavy bargaining calendar in 2008–09. Major contracts, covering over 50 per cent of unionized workers in the BPS and approximately 85 per cent of employees in the OPS, are up for negotiations sometime during 2008–09. The government will expect its bargaining agent partners in this new fiscal environment to achieve affordable agreements.
While the Ontario Government continues to manage its expenses, $76.6 billion (80 per cent) of total government spending in 2008–09 will be provided to transfer payment recipients. Funding will not be increasing in fiscal 2009–10 according to what was projected in the 2008 Budget last March. The government is confident that its transfer partners will work together with the Province to rise to the challenge of the current fiscal situation.
The Province continues to encourage its BPS partners to look for opportunities to modernize. For example, the OntarioBuys program has been innovative in extending supply-chain leading practices to hospitals, school boards, colleges and universities to realize efficiencies. In Toronto, a one-time government investment of $2.6 million at four major Toronto hospitals is leading to $21.1 million in savings over 10 years. A similar one-time government investment of $2 million in London-area hospitals has achieved annual savings of $1.9 million — a payback period of about one year. These are but two examples of the work being accomplished through the OntarioBuys program to ensure that Ontario tax dollars are used efficiently, and that health services continue to improve to meet Ontarians’ needs. Once OntarioBuys is fully implemented across the hospital and education sectors, savings of up to $100 million are expected, which can be reinvested back into front-line services.
Ontario will also work with government agencies to look for efficiencies in their operations.
Section C | Details of Ontario’s Finances
This section provides information on the Province’s historical financial performance, key fiscal indicators and details of Ontario’s current fiscal outlook.
| Actual 2007–08 |
Current Outlook 2008–09 |
Change | ||
|---|---|---|---|---|
| $ Millions | Per Cent | |||
| Revenue | 97,122 | 96,002 | (1,120) | (1.2) |
| Expense | ||||
| Programs | 87,608 | 87,411 | (197) | (0.2) |
| Interest on Debt | 8,914 | 8,891 | (23) | (0.3) |
| Total Expense | 96,522 | 96,302 | (220) | (0.2) |
| Reserve | – | 200 | 200 | – |
| Surplus/(Deficit) | 600 | (500) | (1,100) | – |
| Net Debt1 | 142,418 | 146,311 | 3,893 | 2.7 |
| Accumulated Deficit1 | 105,617 | 106,117 | 500 | 0.5 |
1 Net Debt is calculated as the difference between liabilities and financial assets. The annual change in Net Debt is equal to the surplus/deficit of the Province plus the change in tangible capital assets, the change in net assets of hospitals, school boards and colleges and the change in the fair value of the Ontario Nuclear Funds. Accumulated Deficit is calculated as the difference between liabilities and total assets, including tangible capital assets and net assets of hospitals, school boards and colleges.
| 2004–05 | 2005–06 | 2006–07 | Actual 2007–08 |
Current Outlook 2008–09 |
|
|---|---|---|---|---|---|
| Taxation Revenue | |||||
| Personal Income Tax | 19,320 | 21,041 | 23,655 | 24,538 | 25,171 |
| Retail Sales Tax | 14,855 | 15,554 | 16,228 | 16,976 | 17,206 |
| Corporations Tax | 9,883 | 9,984 | 10,845 | 12,990 | 11,459 |
| Employer Health Tax | 3,886 | 4,197 | 4,371 | 4,605 | 4,821 |
| Ontario Health Premium | 1,737 | 2,350 | 2,589 | 2,713 | 2,809 |
| Gasoline Tax | 2,277 | 2,281 | 2,310 | 2,360 | 2,315 |
| Land Transfer Tax | 1,043 | 1,159 | 1,197 | 1,363 | 1,163 |
| Tobacco Tax | 1,453 | 1,379 | 1,236 | 1,127 | 1,092 |
| Fuel Tax | 727 | 729 | 723 | 733 | 742 |
| Electricity Payments-In-Lieu of Taxes | 511 | 951 | 757 | 546 | 600 |
| Other Taxes | 283 | 292 | 399 | 481 | 472 |
| 55,975 | 59,917 | 64,310 | 68,432 | 67,850 | |
| Government of Canada | |||||
| Canada Health Transfer (CHT) | 5,640 | 7,148 | 7,702 | 8,487 | 8,826 |
| Canada Social Transfer (CST) | 2,912 | 3,324 | 3,478 | 3,778 | 4,089 |
| CHST Supplements | 775 | 584 | – | – | – |
| Social Housing | 522 | 520 | 532 | 525 | 514 |
| Wait Times Reduction Fund | 242 | 243 | 467 | 468 | 235 |
| Infrastructure Programs | 209 | 285 | 191 | 207 | 259 |
| Medical Equipment Funds | 387 | 194 | – | – | – |
| Other Government of Canada | 1,195 | 953 | 1,666 | 3,132 | 2,741 |
| 11,882 | 13,251 | 14,036 | 16,597 | 16,664 | |
| Income from Investment in Government Business Enterprises | |||||
| Ontario Lottery and Gaming Corporation | 1,992 | 2,027 | 1,945 | 1,857 | 1,772 |
| Liquor Control Board of Ontario | 1,147 | 1,197 | 1,307 | 1,374 | 1,420 |
| Ontario Power Generation Inc. and Hydro One Inc. | 444 | 1,107 | 947 | 1,214 | 930 |
| Other Government Enterprises | (5) | (23) | (3) | (8) | – |
| 3,578 | 4,308 | 4,196 | 4,437 | 4,122 | |
| Other Non-Tax Revenue | |||||
| Reimbursements1 | 1,241 | 1,295 | 1,415 | 1,464 | 1,382 |
| Vehicle and Driver Registration Fees | 976 | 763 | 970 | 1,051 | 1,044 |
| Electricity Debt Retirement Charge | 997 | 1,021 | 991 | 982 | 1,004 |
| Power Sales | 610 | 779 | 863 | 929 | 856 |
| Sales and Rentals | 352 | 465 | 1,108 | 553 | 701 |
| Other Fees and Licences1 | 506 | 550 | 624 | 668 | 672 |
| Liquor Licence Revenue | 489 | 516 | 467 | 475 | 454 |
| Net Reduction of Power Purchase Contract Liability | 236 | 396 | 412 | 398 | 373 |
| Royalties1 | 278 | 191 | 215 | 193 | 215 |
| Miscellaneous Other Non-Tax Revenue | 721 | 773 | 790 | 943 | 665 |
| 6,406 | 6,749 | 7,855 | 7,656 | 7,366 | |
| Total Revenue | 77,841 | 84,225 | 90,397 | 97,122 | 96,002 |
1 The change from 2008 Budget Plan reflects reclassification to be consistent with treatment in the 2007–2008 Public Accounts of Ontario.
| Ministry Expense | 2004–05 | 2005–061 | 2006–07 | Actual 2007–08 | Current Outlook 2008–09 |
|---|---|---|---|---|---|
| Aboriginal Affairs 2 | 21 | 50 | 25 | 33 | 55.6 |
| Agriculture, Food and Rural Affairs2 | 795 | 861 | 796 | 731 | 945.6 |
| Attorney General3 | 1,195 | 1,277 | 1,338 | 1,643 | 1,592.20 |
| Board of Internal Economy | 145 | 150 | 163 | 257 | 196.3 |
| Children and Youth Services | 2,793 | 3,271 | 3,264 | 3,721 | 4,086.1 |
| Citizenship and Immigration3 | 62 | 89 | 112 | 90 | 88.1 |
| Community and Social Services | 6,360 | 6,717 | 7,181 | 7,547 | 7,726.5 |
| Community Safety and Correctional Services | 1,732 | 1,749 | 1,876 | 2,003 | 2,140.7 |
| Culture2 | 346 | 478 | 414 | 350 | 379.8 |
| Economic Development and Trade2,4 | 66 | 176 | 199 | 297 | 445.2 |
| Education2 | 365 | 440 | 423 | 446 | 472.3 |
| School Boards' Net Expense | 10,274 | 10,886 | 11,290 | 11,830 | 12,857.2 |
| Energy and Infrastructure2,4 | 246 | 325 | 525 | 401 | 282.7 |
| Environment | 305 | 274 | 314 | 349 | 398.0 |
| Executive Offices | 34 | 31 | 37 | 36 | 36.3 |
| Finance2 | 534 | 578 | 564 | 455 | 557.4 |
| Francophone Affairs, Office of | 3 | 4 | 4 | 5 | 5.3 |
| Government Services2,4 | 1,077 | 742 | 974 | 944 | 1,105.9 |
| Health and Long-Term Care | 17,512 | 17,799 | 19,121 | 20,375 | 21,712.4 |
| Hospitals' Net Expense | 13,877 | 14,816 | 16,145 | 17,381 | 18,436.3 |
| Health Promotion | 236 | 290 | 391 | 364 | 389.7 |
| Labour | 129 | 141 | 146 | 170 | 170.0 |
| Municipal Affairs and Housing2 | 770 | 926 | 843 | 744 | 799.5 |
| Natural Resources3 | 557 | 626 | 731 | 794 | 780.2 |
| Northern Development and Mines | 320 | 337 | 318 | 346 | 357.5 |
| Research and Innovation2 | 236 | 332 | 316 | 301 | 382.8 |
| Revenue | 523 | 442 | 563 | 554 | 610.6 |
| Small Business and Consumer Services3,4 | 20 | 26 | 25 | 31 | 29.8 |
| Tourism3 | 167 | 210 | 204 | 234 | 177.4 |
| Training, Colleges and Universities2 | 3,297 | 3,509 | 4,115 | 4,384 | 4,825.3 |
| Colleges' Net Expense | 1,289 | 1,185 | 1,273 | 1,403 | 1,415.6 |
| Transportation2 | 1,744 | 1,802 | 1,794 | 1,899 | 1,960.9 |
| Interest on Debt | 9,368 | 9,019 | 8,831 | 8,914 | 8,891.0 |
| Other Expense2 | 2,998 | 4,369 | 3,813 | 7,490 | 3,091.7 |
| Year-End Savings5 | – | – | – | – | (1,100.0) |
| Total Expense | 79,396 | 83,927 | 88,128 | 96,522 | 96,301.9 |
1 Starting in 2005–06, the Province's financial reporting was expanded to include hospitals, school boards and colleges using one-line consolidation. Prior to 2005–06, historical figures reflect grants to these entities for comparison purposes.
2 Details on Other Ministry Expense can be found in Table 7, Other Expense.
3 Decline from 2007–08 to 2008–09 due to one-time initiatives in 2007–08.
4 Pending finalization of new ministry structure. Future updates will reflect adjusted ministry expense, including the newly formed Ministry of International Trade and Investment.
5 As in past years, the Year-End Savings provision reflects anticipated underspending that has historically arisen at year-end due to factors such as program efficiencies, and changes in project start-ups and implementation plans.
Note: Numbers may not add due to rounding.
| Ministry Expense | 2004–05 | 2005–06 | 2006–07 | Actual 2007–08 |
Current Outlook 2008–09 |
|---|---|---|---|---|---|
| Aboriginal Affairs | |||||
| One-Time Expense for the First Nations Gaming Agreement | – | – | – | 201 | – |
| Agriculture, Food and Rural Affairs | |||||
| One-Time Extraordinary Assistance | 458 | 125 | 259 | 274 | – |
| Time Limited Assistance | 143 | 157 | 19 | 76 | 166.5 |
| Culture | |||||
| One-Time Investments | – | – | – | 57 | – |
| Economic Development and Trade1 | |||||
| One-Time Investments | – | – | – | 152 | – |
| Education | |||||
| Teachers' Pension Plan2 | 240 | 295 | 345 | 342 | 54.0 |
| Energy and Infrastructure | |||||
| Capital Contingency Fund | – | – | – | – | 171.9 |
| One-Time Investments in Municipal Infrastructure | – | – | 140 | 450 | – |
| Finance | |||||
| Community Reinvestment Fund One-Time Transition Funding | 233 | – | – | – | – |
| Investing in Ontario | – | – | – | 1,149 | – |
| Ontario Municipal Partnership Fund3 | 626 | 714 | 758 | 907 | 934.8 |
| Operating Contingency Fund | – | – | – | – | 193.4 |
| Power Purchases | 840 | 803 | 863 | 929 | 856.0 |
| Government Services | |||||
| Pension and Other Employee Future Benefits | 458 | 729 | 557 | 531 | 715.0 |
| Municipal Affairs and Housing | |||||
| One-Time Investment in Municipal Social Housing Stock | – | – | – | 100 | – |
| Research and Innovation | |||||
| One-Time Investments | – | – | – | 87 | – |
| Training, Colleges and Universities | |||||
| One-Time Investments | – | – | – | 699 | – |
| Transportation | |||||
| One-Time Transit and Infrastructure Investments | – | 1,546 | 872 | 1,536 | – |
| Total Other Expense | 2,998 | 4,369 | 3,813 | 7,490 | 3,091.7 |
1 Pending finalization of new ministry structure. Future updates will reflect adjusted ministry expense.
2 Numbers reflect accrued pension expense, not Ontario's contributions. Ontario's matching contributions to the plan grow from $708 million in 2004–05 to $808 million in 2007–08 and $1,061 million in 2008–09.
3 The 2004–05 figure includes transfers under predecessor Community Reinvestment Fund.
Note: Numbers may not add due to rounding.
| Sector | Total Infrastructure Expenditures 2007–08 Actual |
2008–09 Current Outlook | ||
|---|---|---|---|---|
| Investment in Capital Assets |
Transfers and Other Expenditures in Infrastructure1 |
Total Infrastructure Expenditures |
||
| Transportation | ||||
| Transit | 1,857.6 | 901.0 | 349.9 | 1,250.9 |
| Highway Construction | 1,452.2 | 1,484.3 | – | 1,484.3 |
| Other Transportation2 | 710.3 | 520.5 | 70.7 | 591.3 |
| Health | ||||
| Hospitals | 638.0 | 1,045.7 | 2.5 | 1,048.2 |
| Other Health | 285.9 | 60.8 | 187.4 | 248.1 |
| Education | ||||
| School Boards | 950.4 | – | 1,018.6 | 1,018.6 |
| Colleges | 183.3 | 202.0 | – | 202.0 |
| Universities | 677.6 | – | 54.8 | 54.8 |
| Water/Environment | 387.7 | 16.3 | 286.9 | 303.2 |
| Municipal and Local Infrastructure3 | 1,794.8 | 33.1 | 274.9 | 308.0 |
| Justice | 215.2 | 426.2 | 49.7 | 475.9 |
| Other | 717.1 | 244.9 | 294.1 | 539.0 |
| Total4 | 9,870.1 | 4,934.7 | 2,589.5 | 7,524.2 |
1 Mainly consists of transfers for capital purposes to municipalities and universities, expenditures for servicing capital-related debt of schools, and expenditures for the repair and rehabilitation of schools. These expenditures are included in the Province's total expense in Tables 6 and 7.
2 Other Transportation includes planning activities, property acquisition, and other infrastructure programs (e.g., Municipal/Local Roads/Remote Airports).
3 Municipal and local water and wastewater infrastructure investments are included in the Water/Environment sector. 2007–08 actual expenditures include $1,149 million under the Investing in Ontario Act, 2008.
4 Total expenditures in 2008–09 include $48 million in flow-throughs in Investment in Capital Assets (for provincial highways) and $225 million in flow-throughs in Transfers and Other Expenditures in Infrastructure ($15 million in Transportation, $15 million in Health, $67 million in Water/Environment, $128 million in Municipal and Local Infrastructure).
Note: Numbers may not add due to rounding.
| 1999–00 | 2000–01 | 2001–02 | 2002–031 | 2003–04 | 2004–05 | 2005–062 | 2006–07 | Actual 2007–08 | Current Outlook 2008–09 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Financial Transactions | ||||||||||
| Revenue | 65,042 | 66,294 | 66,534 | 68,891 | 68,400 | 77,841 | 84,225 | 90,397 | 97,122 | 96,002 |
| Expense | ||||||||||
| Programs | 53,347 | 53,519 | 55,822 | 59,080 | 64,279 | 70,028 | 74,908 | 79,297 | 87,608 | 87,411 |
| Interest on Debt | 11,027 | 10,873 | 10,337 | 9,694 | 9,604 | 9,368 | 9,019 | 8,831 | 8,914 | 8,891 |
| Total Expense | 64,374 | 64,392 | 66,159 | 68,774 | 73,883 | 79,396 | 83,927 | 88,128 | 96,522 | 96,302 |
| Reserve | – | – | – | – | – | – | – | – | – | 200 |
| Surplus/(Deficit) | 668 | 1,902 | 375 | 117 | (5,483) | (1,555) | 298 | 2,269 | 600 | (500) |
| Net Debt3, 4 | 134,398 | 132,496 | 132,121 | 132,647 | 138,816 | 140,921 | 141,928 | 141,100 | 142,418 | 146,311 |
| Accumulated Deficit5 | 134,398 | 132,496 | 132,121 | 118,705 | 124,188 | 125,743 | 109,155 | 106,776 | 105,617 | 106,117 |
| Gross Domestic Product (GDP) at Market Prices | 409,020 | 440,759 | 453,701 | 477,763 | 493,081 | 517,068 | 536,431 | 559,840 | 584,053 | 596,245 |
| Personal Income | 321,702 | 347,653 | 361,187 | 369,420 | 381,127 | 401,066 | 419,253 | 441,371 | 463,520 | 483,104 |
| Population — July (000s) | 11,505 | 11,683 | 11,897 | 12,091 | 12,242 | 12,391 | 12,528 | 12,665 | 12,794 | 12,929 |
| Net Debt per Capita (dollars) | 11,682 | 11,341 | 11,106 | 10,971 | 11,339 | 11,373 | 11,328 | 11,141 | 11,132 | 11,317 |
| Personal Income per Capita (dollars) | 27,963 | 29,756 | 30,360 | 30,553 | 31,132 | 32,369 | 33,464 | 34,849 | 36,231 | 37,366 |
| Total Expense as a per cent of GDP | 15.7 | 14.6 | 14.6 | 14.4 | 15.0 | 15.4 | 15.6 | 15.7 | 16.5 | 16.2 |
| Interest on Debt as a per cent of Revenue | 17.0 | 16.4 | 15.5 | 14.1 | 14.0 | 12.0 | 10.7 | 9.8 | 9.2 | 9.3 |
| Net Debt as a per cent of GDP | 32.9 | 30.1 | 29.1 | 27.8 | 28.2 | 27.3 | 26.5 | 25.2 | 24.4 | 24.5 |
| Accumulated Deficit as a per cent of GDP | 32.9 | 30.1 | 29.1 | 24.8 | 25.2 | 24.3 | 20.3 | 19.1 | 18.1 | 17.8 |
1 Starting in 2002–03, major tangible capital assets owned by Provincial ministries (land, buildings and transportation infrastructure) are accounted for on a full accrual accounting basis. Other tangible capital assets owned by Provincial ministries are accounted for as expense in the year of acquisition or construction. All capital assets owned by consolidated organizations are accounted for on a full accrual basis.
2 Starting in 2005–06, the Province's financial reporting was expanded to include hospitals, school boards and colleges using one-line consolidation. Total expense prior to 2005–06 has not been restated to reflect expanded reporting.
3 Net Debt is calculated as the difference between liabilities and financial assets. The annual change in Net Debt is equal to the surplus/deficit of the Province plus the change in tangible capital assets, the change in net assets of hospitals, school boards and colleges and, effective April 1, 2007, the change in the fair value of the Ontario Nuclear Funds.
4 Net Debt is restated in 2003–04, 2004–05 and 2005–06 to reflect the value of hydro corridor lands transferred to the Province from Hydro One Inc.
5 Accumulated Deficit is calculated as the difference between liabilities and total assets, including tangible capital assets and net assets of hospitals, school boards and colleges. The annual change in the Accumulated Deficit is equal to the surplus/deficit plus, effective April 1, 2007, the change in the fair value of the Ontario Nuclear Funds. For fiscal 2005–06, the change in the Accumulated Deficit includes the opening combined net assets of hospitals, school boards and colleges that were recognized upon consolidation of these Broader Public Sector entities. For fiscal 2006–07, the change in the Accumulated Deficit includes an adjustment to the unfunded liability of the Ontario Electricity Financial Corporation made at the beginning of the year. For fiscal 2007–08, a $1.2 billion decrease in the Accumulated Deficit is made up of $0.6 billion in the Province's operating surplus, with the remainder resulting from a change in accounting policy. Under this change, Ontario Nuclear Funds Agreement (ONFA) funds are reported at fair value on Ontario Power Generation Inc. (OPG) books and, upon consolidation, on the Province's consolidated financial statements.
Sources: Ontario Ministry of Finance and Statistics Canada.
