The McGuinty government is committed to building the electricity system the people of Ontario need and deserve to power their homes and businesses — a clean, modern and reliable system with stable prices.
For a decade, Ontario made little investment in new supply and transmission infrastructure. By 2003, Ontarians did not know if the lights would stay on. The province had just endured the largest blackout in North American history. The previous government’s reliance on five coal plants meant that about 25 per cent of Ontario’s electricity came from dirty coal. There was no plan for conservation, and no plan for supply to keep up with demand. Energy infrastructure was under stress and in decline. Instead of adding generation capacity, the electricity system lost a net 1,800 megawatts (MW) of power capacity — the equivalent of Niagara Falls running dry. Moreover, Ontario had to import U.S. coal-generated electricity just to keep the lights on. The government had even set up emergency generators for fear of brownouts. A brief deregulated market experiment in 2002 saw spot-market energy prices spike an average of about 30 per cent over seven months. That prompted the government of the day to freeze rates at an artificially low level.
As a result of necessary investments in new sustainable generation made by this government, Ontarians can count on a reliable electricity system that ensures the lights stay on. Since 2003, more than 8,000 MW of new, clean power have come online, making up more than 20 per cent of current capacity. Ontario Power Generation completed the refurbishment of Pickering A Unit 1 and launched significant hydroelectric and other renewable and clean energy projects. The Niagara tunnel project, using the largest hard-rock tunnelling machine in the world at the time, will increase the output of power from Niagara Falls and produce enough extra annual energy to power as many as 160,000 homes. The Lower Mattagami hydroelectric project will increase Ontario’s supply of clean, renewable power by about 440 MW, powering over 300,000 homes. Furthermore, Bruce Power is currently working to return two units of Bruce A to operation, with a total of 1,500 MW of additional baseload capacity.
The Province’s transmission and distribution company, Hydro One, has also invested $7 billion in the improvement of some 5,000 kilometres of its transmission and distribution lines, along with other system improvements. Hydro One’s average annual investment has been double what it was from 1996 to 2003. Local distribution companies in the province have also invested in the modernization of Ontario’s distribution system, and are working to develop a smart grid to increase the reliability of electricity delivered to homes and businesses. By using communications technology, the smart grid will make more efficient use of existing infrastructure, improve conservation, and allow better integration of small renewable projects.
These investments have also allowed the Province to pursue the elimination of coal-generated electricity, replacing it with cleaner sources such as wind, solar and bio-energy. In 2005, the government permanently shut down the four-unit Lakeview coal plant in Mississauga. In October 2010, four more coal-fired generating units were permanently shut down. The Province is on track to phase out dirty coal-fired electricity generation in 2014, the largest initiative of its kind in North America in that timeframe. This will be equivalent to taking seven million cars off the road and will improve air quality while reducing health care costs.
A 2005 study by DSS Management Consultants Inc. and RWDI Air Inc., commissioned by the Ministry of Energy, estimated that coal-fired generation was responsible for about $3 billion in annual health damages in Ontario including premature deaths, hospital admissions and various illnesses.
When this government took office in 2003, it inherited an electricity system that had no long-term plan. Through the Electricity Restructuring Act, 2004, the government created and mandated the Ontario Power Authority (OPA) to use a formal 20-year planning process to help forecast and meet the province’s electricity needs. Under this process, the long-term plan was designed to be updated every three years to incorporate developments in technology, in the supply of renewables, and changes to demand.
The OPA’s first long-term plan, known as the Integrated Power System Plan, was submitted in 2007. The Plan was based on a supply-mix directive that the OPA received from the government in 2006. It set the stage for moving Ontario forward to a more sustainable supply mix and reliable system.
Building on these efforts, the government passed the Green Energy and Green Economy Act, 2009 (GEA) as part of its plan for Ontario to become a leading economy in clean and sustainable technologies. The GEA will help boost investments in clean, renewable energy and conservation, securing long-term economic development and job creation in Ontario.
The GEA was a groundbreaking and significant accomplishment. It is:
Since 2003, new renewable energy projects already in place or under construction represent a total investment of approximately $8.1 billion and have brought more than 1,500 MW of new renewable energy online. In 2003, Ontario had only 10 wind turbines; now there are more than 700.
With this foundation in place, it is time to review Ontario’s long-term energy plan. The Ministry of Energy will be releasing an updated Long-Term Energy Plan and a new directive to the OPA shortly.
The 2010 Long-Term Energy Plan will provide the roadmap for an updated supply mix, new investments in transmission and distribution, and stable and predictable industrial and consumer electricity pricing.
In order to have a clean, modern system that includes a significant proportion of renewables, ensures reliability and creates jobs, investments in Ontario’s electricity system will need to continue. While absolutely necessary, these investments are increasing electricity costs. Based on the Ministry of Energy projections from the forthcoming Long-Term Energy Plan, prices over the next 20 years are expected to increase by about 3.5 per cent per year.
Over the next five years, however, residential electricity prices are expected to rise by 46 per cent, which is an average annual rate of about 7.9 per cent. This increase will be due to two factors: upgrading and modernizing Ontario’s existing capacity in nuclear and natural gas generation, transmission and distribution (44 per cent); and the investment in new clean, renewable energy generation (56 per cent).
Continued investments in transmission, conservation and supply are needed for a system that provides more efficient and reliable electricity to consumers whenever they need it and does not pollute Ontario’s air or negatively affect the health of citizens and future generations.
After five years, Ontario will have largely completed the transition to a cleaner, more reliable system due to the replacement of coal-fired generation and new renewable generation under the GEA. The GEA investments will create more than 50,000 jobs. Once these investments have been made, the price increases are expected to moderate.
On October 1, 2009, the Ontario Power Authority (OPA) launched North America’s first comprehensive Feed-in Tariff Program, which pays clean renewable energy generators for the electricity they produce. It is designed to encourage the development of renewable energy projects by a diverse range of small and large-scale generators. Through this new program, the OPA has awarded contracts for 2,500 MW of renewable energy, which will create 20,000 direct and indirect jobs.
Ontario families and businesses are now paying the true cost of electricity. Rising electricity prices are having a significant impact on consumers who are asking for help with the cost of clean, modern energy.
Every little bit of assistance helps during lean times and there are several measures in place or proposed to help families cope with rising electricity costs.
Through the 2010 Ontario Economic Outlook and Fiscal Review, the government is taking action today to help Ontarians who are feeling the pinch of rising costs and electricity prices. The Ontario government is proposing direct relief through a new Ontario Clean Energy Benefit (OCEB).
For eligible consumers, the proposed OCEB would provide a benefit equal to 10 per cent of the total cost of electricity on their bills including tax, effective January 1, 2011. Due to the length of time required to amend bills, these price adjustments would appear on electricity bills no later than May 2011, and would be retroactive to January 1, 2011.
Eligible consumers include residential, farm, small business and other small users. The proposed OCEB would help over four million residential consumers and over 400,000 small businesses, farms, and other consumers with the transition to a reliable and cleaner electricity system as more investment in transmission and supply capacity is brought online to support the province.
The following table provides examples of the impact the proposed OCEB would have on monthly electricity bills.
|Current Estimated Monthly Bill||Estimated Bill after Ontario Clean Energy Benefit||Monthly Benefit1 (10%)||Yearly Benefit1 (10%)|
In 2010–11, the estimated cost of the proposed OCEB is $300 million, with an estimated full-year cost of $1.1 billion next year. These costs are accommodated within the fiscal plan as a result of the government’s prudent approach to managing its finances.
The Province’s revenues from its ownership of Ontario Power Generation and Hydro One are projected to be approximately the same as the cost of the OCEB.
Providing the 10 per cent OCEB to Ontarians is a responsible way of helping Ontario families through the transition to a cleaner electricity system. The OCEB would help residential and small business consumers over the next five years as the grid is modernized and coal generation is eliminated. The government is introducing legislation to implement the proposed OCEB.
In addition to the OCEB, the government will also outline, through its Long-Term Energy Plan, a strategy that will carefully balance cleaner generation, job creation, reliability and cost.
Instead of a system that was polluting, unreliable and in decline with unstable pricing, Ontarians will have a
North American–leading clean energy system that keeps the lights on for generations to come, creates jobs for Ontario families and ensures the air they breathe is cleaner.
Ontario’s Tax Plan for Jobs and Growth and additional tax measures announced since the 2009 Budget would provide tax relief of $12 billion for people over three years.
Permanent cuts to personal income taxes mean that, for 93 per cent of Ontario income tax payers, taxes will be reduced by $200, on average, for the 2010 tax year. In addition, Ontario offers several tax credits that put money back into the pockets of those who need it most. Tax relief provided through tax credits has been significantly enhanced to provide more relief to more people.
Starting with these tax credits, the government is moving towards providing benefits on a more timely and regular basis. People used to receive the combined property and sales tax credits after filing a tax return; that is, once a year in a lump-sum payment. Ontarians began to receive quarterly instalments of the new Ontario Sales Tax Credit in August 2010. The Northern Ontario Energy Credit and proposed Ontario Energy and Property Tax Credit would also begin to be paid four times a year, starting in July 2011. The government will continue to work to better align the timing of Ontario’s tax credits and other benefits with the day-to-day expenses that people face.
These new tax credits would assist low- to middle-income people, and build upon this government’s other initiatives, including the Ontario Child Benefit, introduced in 2007, the Ontario Senior Homeowners’ Property Tax Grant, introduced in 2009, and the proposed Children’s Activity Tax Credit.
A new web portal will soon make it easier for people to find out what tax credits they can claim.
A new Children’s Activity Tax Credit has been proposed to help parents with the cost of enrolling their children in activities that encourage them to be healthy and active. This would be the only tax credit in Canada that provides for a broad range of children’s activities. Parents would be able to claim up to $500 of eligible expenses and receive up to $50 per child per year (up to $100 per child with a disability) towards the cost of these activities. Parents would be able to claim this credit in addition to the federal children’s fitness tax credit.
The federal children’s fitness tax credit is a non-refundable tax credit — it reduces the amount of income tax a person pays. People who do not earn enough to pay income tax do not benefit from non-refundable tax credits. Ontario’s proposed credit would be refundable so people would get the credit even if they pay no income tax. This would allow more lower-income families to benefit.
In addition to helping families through tax relief and the Ontario Clean Energy Benefit, the government is making Ontario a more attractive place for businesses to invest and create jobs. Over three years, the Ontario Tax Plan for Jobs and Growth is providing more than $4.8 billion in tax relief for businesses.
The Tax Plan for Jobs and Growth announced in the 2009 Budget replaced the Retail Sales Tax (RST) with the Harmonized Sales Tax (HST) on July 1, 2010 and delivers both permanent and temporary tax relief to people and businesses. See Chapter 5: Tax and Pension Modernization for additional details on the tax relief measures for people and businesses.
The replacement of the RST with the HST has reduced operating costs for businesses in Ontario. The RST applied to many business purchases and, as a result, multiple layers of sales tax were built into the cost of these purchases. The HST removes the sales tax on business inputs, providing a cost saving to businesses. The HST also simplifies tax compliance for businesses by streamlining tax administration and eliminating over 5,000 pages of outdated rules, regulations and operating procedures. The move to a single tax administration with one set of forms, one payment and one point of contact for audits, appeals and taxpayer services will save businesses more than $500 million a year.
These cost savings allow businesses to lower their prices for Ontario consumers and to better compete for more sales abroad. These changes, combined with other tax relief for businesses, encourage new investment and create jobs.
In today’s global economy, many businesses can operate almost anywhere in the world. In order to compete with other jurisdictions for investment and jobs, Ontario must have a tax system that encourages businesses to locate here. The HST, together with other tax changes, will cut Ontario’s marginal effective tax rate on new business investment in half by 2018, making Ontario one of the most tax-competitive jurisdictions in the industrialized world for business investment, leading to more jobs.
A study that examined the experience in the Atlantic provinces that adopted the HST in 1997 found that investment in machinery and equipment was 12.1 per cent higher relative to other provinces.1 In Ontario, the HST will also contribute to the strong growth in business investment in machinery and equipment expected between 2010 and 2013.
Other studies from around the world have confirmed that lower corporate tax rates result in higher investment, which in turn leads to a higher demand for workers and higher incomes for working people.2
The Tax Plan for Jobs and Growth will lead to similar benefits for Ontarians. It is estimated that by 2020, the reduction in the tax burden on new business investment due to the tax plan and other tax changes will increase investment in the province by $47 billion, leading to almost 600,000 net new jobs and higher annual incomes of up to 8.8 per cent.3
Investment in public infrastructure is a key component of the government’s Open Ontario plan and an essential building block of the economy. Infrastructure investments are improving Ontario’s schools, hospitals, roads and bridges. They enhance the quality of life for citizens, improve public services, reduce business costs and stimulate the economy by preserving and creating jobs.
Conference Board of Canada, March 2010
The Conference Board of Canada produced a report that assessed the economic impact of public infrastructure investment in Ontario.1
1Pedro Antunes, Kip Beckman and Jacqueline Johnson, “The Economic Impact of Public Infrastructure in Ontario,” The Conference Board of Canada, March 2010.
The government is investing approximately $28 billion in 2009–10 and 2010–11 to stimulate economic growth. These investments include short-term stimulus projects as well as major new investments to enhance Ontario’s economic and community-based infrastructure.
Ontario’s communities are benefiting from infrastructure investments in clean water, health, education, transportation, culture, tourism, sports and recreation, and social and affordable housing.
Significant progress was made over the summer construction season on the government’s stimulus investments. For example, the average percentage of project completion for the Infrastructure Stimulus Fund rose from 42 per cent in June 2010 to 66 per cent in October 2010. Over 3,300 short-term stimulus projects are now complete.
Infrastructure investments are making a difference in Ontario:
For more information on Ontario’s infrastructure investment, visit: www.ontario.ca/infrastructure
A well-educated workforce drives the province’s economic growth and competitiveness. That is why education, from early learning through elementary, secondary and postsecondary, is a top priority for the McGuinty government. Ontario’s colleges, universities and training institutions play a critical role in equipping people for the jobs that will ensure future prosperity. They also open the province to the world, attracting students from every corner of the globe, which has significant economic benefits in a knowledge-based economy.
More than one in four children who enter Grade 1 are significantly behind their peers. Many never close the gap and are unable to fully participate in and contribute to society. To ensure that a quarter of Ontario’s children are not left behind, more must be done, earlier, to support children’s learning. That is why Ontario introduced full-day kindergarten for four- and five-year-olds.
Full-day kindergarten is an important part of the government’s Open Ontario plan. Getting kids off to a good start today means a strong economy in the future. Full-day kindergarten and seamless before- and after-school programs also help busy parents save time and money.
The government is committed to strengthening the retirement income system and helping Ontarians secure a stable retirement. More Ontarians are concerned about their retirement savings because they saw how the global recession affected their investments. At the same time, fewer working Ontarians have a pension plan. Many Ontarians are not saving enough to maintain their standard of living in retirement and are feeling insecure and uncertain about their financial future.
The discussion paper “Securing Our Retirement Future: Consulting with Ontarians on Canada's Retirement Income System” can be found at: www.ontario.ca/pensions
Ontario has a comprehensive plan to improve retirement income security for Ontarians. The plan consists of three key elements:
The Securing Pension Benefits Now and for the Future Act, 2010 proposes changes that would strengthen pension funding rules, clarify pension surplus rules and ensure a more sustainable Ontario Pension Benefits Guarantee Fund. It builds on the first phase of reforms that were passed unanimously by the legislature in May 2010 (the Pension Benefits Amendment Act, 2010). These changes constituted the first major pension reforms in over 20 years.
Ontario is moving ahead with plans to protect consumers and investors and to ensure strong and competitive financial markets. Canada’s financial system, largely based in Ontario, has emerged as a world leader, according to the latest reports by the International Monetary Fund and World Economic Forum. Effective federal and provincial regulation and prudent risk management contributed greatly to market safety and stability.
The government is modernizing Ontario’s financial regulation by protecting consumers and investors, strengthening regulatory requirements to bolster the soundness and stability of financial markets, and adopting flexible and effective global regulatory practices.
“The evolution of the capital markets also reinforces that now — more than ever — we must reform our system of regulation by supporting the implementation of a national securities regulator. I am committed to supporting the Ontario Government, the Canadian Securities Transition Office and participating provincial regulators to make this important goal a reality.”
Howard Wetston, recently appointed Chair of the Ontario Securities Commission, Remarks to the Standing Committee on Government Agencies, November 2, 2010
The “Investor Advisory Panel” section of the OSC website includes information on the Panel, its mandate and members, meeting agendas and minutes, initiatives it is considering and its submissions to the Commission:
Through the Open Ontario plan, the government has supported key sectors in the economy to encourage jobs and growth. These supports have improved competitiveness and will help to ensure long-term prosperity.
The Province is investing heavily in public transit. By the end of 2010–11, the Province will have provided $10.8 billion in support including $4.7 billion for GO Transit since 2003. The Province is committed to making further significant investments in the Metrolinx Regional Transportation Plan and other municipal transit priorities. These projects will ease traffic congestion, thereby improving the movement of people and goods on Ontario’s roads and highways.
Ontario is committed to helping strengthen and increase prosperity in the North. The government is promoting economic growth with new investments to help all northern Ontarians participate in and benefit from emerging economic development opportunities.
The government is taking action to help build opportunities in the Ring of Fire, an area of the Far North with potentially large deposits of minerals like chromite, copper, nickel and platinum. On September 30, 2010, a Ring of Fire Coordinator was appointed. The Coordinator will work with northerners, Aboriginal communities and the mining industry to help facilitate new mining development.
The Far North Act, 2010, when proclaimed, will support growth in the region through land use planning that enables both economic development and the protection of approximately 225,000 square kilometres of public lands. First Nations will work with Ontario to identify the areas to be protected and the law will require First Nations’ approval of community-based land use plans.
The auto industry is a key driver of Ontario’s economy. It includes major vehicle assemblers and more than 400 parts manufacturing plants, accounting for over 90 per cent of the total Canadian automotive industry. There are five automakers with 12 assembly plants and one heavy-truck manufacturer in the province. Ontario builds more vehicles than any other province or state in North America.
The auto industry was hit hard in the global recession. It is now on the path to profitability, as production volumes increase. For the first 10 months of 2010, total vehicle production in Ontario rose by 46 per cent, compared to the same period last year. Ontarians are expected to produce about 1.9 million vehicles in 2010.
Ontario is a leading player in the North American auto industry and is taking steps to remain a leader in the future. The Province invested $4.6 billion in General Motors and Chrysler to preserve at least 85,000 jobs and ensure the future global competitiveness of a sector that directly and indirectly supported about 400,000 Ontario jobs in 2008.
Ontario was the only sub-national jurisdiction in North America to make these investments. This action was necessary to save thousands of jobs and avoid significant permanent damage to Ontario’s economy and communities.
The financial services sector is a critical engine and a key job creator in Ontario’s economy. Toronto is home to the head offices of globally successful banks, insurance companies, and investment and pension funds. It is the third-largest financial centre in North America based on employment. Since 2003, employment in the financial services sector grew to 365,000 jobs in 2009, an increase of 60,000 jobs. The sector supports an estimated 280,000 ancillary jobs, including high-paying business services jobs (such as software design).
The Ontario government is partnering with leaders in the financial services industry through the Financial Services Leadership Council to implement a plan to improve the sector’s competitiveness and create thousands of high-paying jobs. This is part of the Open Ontario plan, which includes helping Toronto become one of the top 10 financial centres in the world. Toronto currently ranks twelfth based on the Global Financial Centres Index.
The government has a record of achieving fiscal results ahead of schedule. It eliminated the $5.5 billion deficit it inherited and posted three consecutive balanced budgets.
The current deficit projection for 2010–11 of $18.7 billion is down from the $19.7 billion forecast in the 2010 Budget. The current projection represents an almost 25 per cent improvement from the $24.7 billion deficit forecast a year ago for
The Province remains on track to meet its medium-term fiscal targets and achieve its plan to cut the deficit in half within five years of its highest point and eliminate it in eight years.
The improvement in the 2010–11 fiscal forecast is mainly due to an increase in revenue resulting from stronger economic growth and the government’s prudent fiscal and expenditure management. Over the past seven years, the government’s responsible approach has enabled Ontarians to benefit from ongoing investments in education, health care and infrastructure — even during the difficult 2008 global economic recession.
Since 2003, the government has continuously worked to modernize the delivery of public services, create administrative efficiencies, and improve accountability and transparency to achieve better value for money.
In 2007, the government announced that over four years it had identified savings of $806 million, by consolidating administration, streamlining processes, making better use of technology, and establishing ongoing cost-avoidance and cost-reduction initiatives. In 2008–09, Ontario’s spending per capita on general government services was $134 per person. This is the second lowest among the provinces and 28 per cent lower than the $186 average per person spent across all provincial governments.
Building on these results, as part of its 2010 ongoing comprehensive review, the government has identified an additional $260 million in efficiency savings.
The government remains committed to managing growth in spending. These actions allow the Province to support the Open Ontario plan investments in knowledge and skills, health care, the green economy and the Poverty Reduction Strategy.
The Province of Ontario is the first jurisdiction in the world to provide electronic registration of land-related documents. Electronic land registration enhances security, improves the accuracy and integrity of the database, and provides an electronic audit trail.
The government has negotiated the principal terms of a proposed agreement to renew its long-standing business partnership with Teranet Inc. by extending Teranet’s exclusive licences to provide electronic land registration and writs services in Ontario.
Teranet was formed in 1991 as a partnership between the Province of Ontario and the private sector to create an electronic land registration system. The task involved moving from a 200-year-old paper-based system to create a database with records for more than five million parcels of land.
In 1999 the first electronic transaction took place and, since then, Ontario’s Electronic Land Registration System has grown to contain information on over four million properties, with registration volumes in excess of two million per year.
Teranet, under existing agreements with the Province, has the exclusive right until 2017 to operate Ontario’s Electronic Land Registration System, which allows for electronic registration of land documents as well as title searches relating to real property and writ searches.
Since Teranet’s creation, the Province has been involved in a number of Teranet transactions:
The Province continues to provide ongoing oversight of the Electronic Land Registration System.
Teranet Inc., which is owned by Borealis Infrastructure, was formed to provide electronic land registration services for the Province in 1991. The Province has negotiated the principal terms of a proposed agreement with Borealis to continue this long-standing business partnership by renewing, for an additional 50 years, Teranet’s exclusive licences to provide electronic land registration and writs services in Ontario.
Under the proposed agreement, Borealis would provide the Province with an upfront payment of $1 billion, which would be used to reduce the Province’s debt. Reducing borrowing needs would lower interest costs, and lowering interest costs would create more fiscal room. Using the Borealis payment to reduce debt would also help protect the fiscal plan against any future rise in interest rates. Beginning in 2017, the Province would also receive annual royalty payments from Teranet, which are expected to be approximately $50 million in 2017–18 and to grow in future years.
The proposed agreement would also specifically provide for Provincial control over the fees charged by Teranet for statutory land registration and writs services. The proposed agreement does not provide for any fee increases for five years. In 2015, certain fees would be increased to equalize fees for searches done in land registration offices and those done remotely, and certain fees would be adjusted by 50 per cent of inflation based on the consumer price index. The first adjustment would be cumulative, based on 50 per cent of inflation over the previous five years, with future adjustments occurring annually. Because these adjustments would be based on only 50 per cent of the full rate of inflation, fees would not rise as quickly as inflation and thus decline in real terms over time.
The Province would also continue its oversight of the integrity of the Electronic Land Registration System data. In addition, the proposed agreement includes a performance framework and commitments by Teranet to ensure Ontario’s Electronic Land Registration System remains modern, user friendly, reliable and secure.
In contrast to the previous government’s Highway 407 Express Toll Route transaction, this proposed agreement contains significant consumer protection tools such as Provincial control over any increases to fees charged by Teranet for statutory services. Further, this proposed agreement includes provisions ensuring the Province has ongoing participation in Teranet through royalties and the potential to share in any extraordinary profits realized by Teranet through a sale, or the exceptional performance, of the business.
This proposed agreement would ensure that high-quality services continue to be delivered to the public and that the electronic service offerings continue to be enhanced and modernized.
The proposed transaction is subject to certain final closing conditions and is expected to close in late 2010.
Since 2003, the government has introduced a number of measures to improve accountability and transparency within the OPS and across the broader public sector. More recently, Premier McGuinty committed to implementing additional accountability measures to ensure taxpayer dollars are used wisely.
Since 2006, the government has implemented reforms under the Ontario Drug Strategy to improve the value for money that Ontarians pay for prescription drugs.
The government is currently working with its provincial and territorial partners to establish a pan-Canadian purchasing alliance to consolidate public-sector procurement of some common drugs, medical supplies and equipment. By capitalizing on a combined purchasing power, provinces and territories could achieve economies of scale and the realized savings could be redirected to patient care.
Under the Open Ontario plan, the government committed to improving quality and accountability in the health care system and to focusing on patient care by promoting effective health care services based on medical evidence.
The government is committed to making the OPS more efficient, while recognizing the importance of the services it delivers to the citizens of Ontario. In the 2009 Budget, the government announced it would reduce the size of the OPS by five per cent over three years through attrition and other measures.
The 2010 Budget announced actions to manage compensation costs, the largest single expense for government. Currently, 55 per cent — or more than $50 billion — of all government program expense goes to compensation, either directly or through transfers.
As a result of the government’s approach, provincial public-sector settlement trends have fallen since the Budget to below the averages in the private sector as well as the municipal and federal public sectors.
Ontarians value and appreciate the contributions of those who deliver their public services. The compensation restraint measures that the government has taken ask employers and employee groups in the public sector to work together and do their part to sustain public services.
It is now up to bargaining agents and employers to ensure that the progress made together to restore services in hospitals, schools and other public services is maintained.
The government recognizes the importance of continuing to balance investments in infrastructure to help build a stronger economy with the need to be fiscally responsible. To ensure the right balance between infrastructure priorities and deficit reduction, the government has committed to undertaking a comprehensive review of capital spending.
As announced in the 2010 Budget, the government has continued a comprehensive review of all government programs and services. The review is working to ensure that the government’s resources are focused on delivering the programs and services that support:
The goal of the review is to move resources from low-priority areas to high-priority ones and to move forward the Open Ontario plan.
To date, the review has identified over $260 million in potential savings through both programming and administrative expenditure reductions. Some recent examples of savings include: