Ontario Budget 2007: Chapter I: Investing in People and Expanding Opportunity

Section H: Expanding Opportunities through a Modern and Efficient Government

Overview

The government is delivering dynamic, modern and efficient public services, focused on priorities and results. It is accomplishing this despite having inherited a fiscal deficit of $5.5 billion, plus deficits in health, education and infrastructure. The McGuinty government has successfully tackled a dual challenge: to restore Ontario’s fiscal health while investing in the services and priorities that Ontarians value most — better health, student success, a strong economy and expanded opportunities for all Ontarians.

The government has increased efficiency across all its operations, and reinvested in the services Ontarians need most. It is freeing up resources through consolidated administrative services, better use of information technology and streamlined purchasing processes. By reallocating efficiencies into key priorities — health care, education, a prosperous economy and safe, strong communities — the government has been able to improve results and services for Ontarians in these crucial areas.

Table 12
Total Program Review Savings and Efficiencies
($ Millions)

	2007–08
Supply Chain and Transaction Services A more streamlined purchasing process, vendor rebates and new vendors of record are decreasing procurement costs	200
Information and Information Technology Consolidation of desktop management and rationalization of common services and applications across the Ontario Public Service; reduced inbound toll-free and outbound long-distance telephone costs	100
Accommodation Savings Review Reduced accommodation costs by better aligning real estate needs and retrofitting government buildings so they use less energy	50
Revenue Savings Improving the collection of the government's accounts receivable and increasing the use of electronic funds transfers, resulting in more efficient management of government revenues	57
Salary and Wage Pressures Absorbed Ministries have realized sufficient savings from program review to absorb costs	366
Ministry Efficiencies - Absorbing Inflationary Costs Inflationary costs such as increased fuel and electricity	18
Central Agency Review/Integration Integration of central agencies and streamlined decision-making through integrated systems and processes	15
Total	806

Since 2004, government ministries have contained growth in spending by absorbing hundreds of millions of dollars in increased costs, including inflation, salaries and administrative expenses.

As a result of these efficiencies, the cost of administering government since 2004 has decreased from 15 per cent to 14 per cent of total government spending.¹ In fact, according to Statistics Canada, Ontario’s spending on general government services, which includes general administration costs, was $119 per person in 2005–06 — the second-lowest rate among provincial governments, and 34 per cent below the $181 average per-person expenditure of other provincial and territorial governments.²

By restricting administrative spending and absorbing millions in cost increases, Ontario has been able to invest in priority public services.

Considerable annual savings have already been achieved. The government is determined to continue looking for ways to cut administrative costs and improve services. To that end, an annual year-end savings target of approximately one per cent of total spending is now included in the Province’s medium-term fiscal outlook.

Ontario continues to pursue opportunities to work across different levels of government. Citizens expect different levels of government to work together to get the most out of their investments in public services. Ontario is a national leader in government service integration, bringing together federal, municipal and provincial services in one-stop locations, such as the Ottawa Government Service Centre. Ontario has also successfully negotiated agreements with other levels of government to harmonize or rationalize how services are delivered to citizens, in areas such as corporate tax administration, labour-market training and employment services, and is working on an agreement for meat inspection. These and other examples of cross-government partnerships are highlighted below. Further details are found in Section G: Investing in Ontario’s Infrastructure.

Improving Services — Ontarians Benefit from Public Services Daily

To ensure that public services focus on Ontarians’ priorities and are delivered cost effectively, the government has been modernizing its business practices. It has also been working with its health and education partners in the broader public sector (BPS) to help them improve services to the public by using information technology more effectively and streamlining business processes.

Health

The government is implementing key strategies and investments to transform the delivery of health services, as outlined in Section D: Expanding Opportunities for Better Health. With this Budget, the government is providing an additional $64 million in 2007–08 to further its comprehensive e-Health strategy, including a new secure electronic health record.

In addition, the government is making improvements to the efficiency of back-office services that support better patient care. To focus resources on direct patient care, the government, through OntarioBuys, has made a one-time investment of $13.1 million in six electronic supply chain management projects involving 46 hospitals and health care facilities. These projects are already reaping administrative savings, expected to reach $7 million annually by next year, plus additional one-time savings that will be redirected to patient care. Annual savings from supply chain modernization across the health care sector are expected to reach $50 million by 2009–10.

Highlights include the following:

• One-time funding of $1.4 million through the OntarioBuys program, allowing The Ottawa Hospital to replace manual procurement with efficient electronic processes, immediately eliminating 11,000 paper cheques and 10,000 paper invoices annually. These measures have resulted in annual savings of $1.2 million for reinvestment in health care services.
• A $1.7 million investment through OntarioBuys to help The Hospital for Sick Children in Toronto implement an automated re-supply system that increases supply chain accuracy and streamlines the ordering process. As a result, frontline staff have more time to do their jobs, with nursing staff alone having an estimated 300 additional hours a week to devote to direct patient care.
• A joint venture involving London Health Sciences Centre and St. Joseph’s Health Care has saved $5 million in inventory costs and $1.7 million in administrative costs. This initiative has also freed up 40,000 square feet of hospital space — the equivalent of two Olympic-sized ice rinks — through the creation of a common warehouse facility serving several London-area hospitals.

Education

Ontario has made substantial investments in a strong education system, in part by achieving efficiencies and reallocating resources. Initiatives include:

• implementing lower-cost, long-term financing totalling $758 million for school boards
• integrating technology systems across government and with school boards to foster more efficient financial management and cost-effective service delivery
• introducing an e-learning strategy, which has allowed 55 school boards to save costs by accessing online courses, a digital library and technical training
• providing seed money to nine colleges, universities and school boards, through OntarioBuys, to support the formation of the Ontario Education Collaborative Marketplace (OECM), an electronic procurement initiative. These initial participating institutions purchase over $1 billion in goods and services annually. Projected annual savings across the education sector are $50 million by 2009–10 and $70 million by 2010–11
• investing to give students at the province’s 20 universities 24/7 online access to more than
  50,000 books.

Business

The government has introduced numerous efficiencies to improve Ontario’s business climate — reducing the paper burden, streamlining tax processes and modernizing the business law framework. Through these, and by working with other levels of government and developing more efficient delivery channels, the Province continues to improve Ontario’s business environment.

• It is now possible to register Ontario businesses online in just 20 minutes — versus six weeks by mail. A "one-window" Regulatory Registry for small businesses and an improved Business Registration and Change of Business Information service allow businesses to simultaneously notify both the Province and the Canada Revenue Agency of any changes, including address and status.
• Starting in 2007–08, the government is investing $500,000 annually, through the Ministry of Economic Development and Trade, to modernize the regulatory regime for business and streamline approval processes.
• To make it easier and more convenient for businesses to comply with Ontario’s tax laws, the government has launched Modernizing Ontario’s Systems for Tax Administration (MOST), one of its largest business transformation projects. The MOST project will provide enhanced services enabling Ontario businesses to access and view tax-related information, file returns and pay their taxes electronically. This will improve client service, ensure fairness in the tax system and secure the Province’s tax revenue stream.
• The Province and the federal government recently signed a memorandum of agreement on corporate tax administration. Enabling legislation, if enacted, would transfer administration of Ontario’s corporate income tax and capital tax to the Canada Revenue Agency, effective for taxation years ending after 2008. Corporate tax harmonization — with one tax form, one tax administration and one set of tax rules — is estimated to save corporations $90 million annually in Ontario corporate income tax and up to an additional $100 million annually in compliance costs. See Chapter III: Ontario’s Tax System Supports Expanded Prosperity for more information.
• BizPaL, an online pilot project at www.bizpal.ca, simplifies and expedites the business permit and licence process by providing one-stop access to permit and licence information for all levels of government.
• The government is continuing to modernize Ontario’s corporate and commercial law framework to reduce undue burdens on Ontario businesses, through a comprehensive overhaul of corporate law and updates to laws on the transfer of securities held in electronic form.
• Ontario is leading the drive to establish a common securities regulator for Canada.
• Efficiencies allowed the hiring of 200 additional workplace health and safety inspectors without increasing overhead costs, helping reduce time lost due to injuries.
• Other improvements benefiting workers include expanded regional and online access to information as well as multilingual employment standards publications to ensure fair and improved access by the province’s most vulnerable workers for filing of their employment standards claims.

Improved Access and Response Times

Through focused resources, better use of technology and working with other levels of government, the Province has greatly improved access and response times for the routine transactions that matter to individuals, families and businesses.

• ServiceOntario, the government’s one-stop modern retail service delivery network, offers high-quality, effective accessible services for routine transactions, including birth, marriage and business registrations — both online and through information centres. New centres have opened in Ottawa, Belleville, Peterborough, Geraldton, Owen Sound and Windsor, bringing the total to 64 across the province.
• After inheriting a birth-certificate system with massive backlogs and delays, Ontario was the first government in North America to offer a money-back service guarantee: 15 business days to deliver online birth certificates. As of December 15, 2006, 99.7 per cent of requests have been met on time. Previously, Ontarians had waited up to 19 weeks for regular delivery of birth certificates. As well, a single online process now allows parents to register their child’s birth and obtain the birth certificate and social insurance card, all at the same time. Even with a 20 per cent increase in demand for certificates, to meet new U.S. border-crossing requirements, ServiceOntario has been able to manage the increased workload without additional funding.
• The Province announced in January 2007 that it is expanding the money-back guarantee to apply to marriage and death certificates. In February 2007, it announced a two-day money-back guarantee for a master business licence, which businesses need to open a bank account and operate in Ontario.
• Ontarians can update their addresses online for drivers’ licences, health cards and outdoor cards, and obtain other commonly needed services, including licence renewal, used-vehicle information and customized licence plates, through new features offered by ServiceOntario.
• The government has expanded public access to online information on government services at 42 public libraries and 13 First Nations public libraries across the province. This Budget invests a further $5 million in Ontario’s libraries.

Ensuring access to justice is a cornerstone of Ontario’s justice system and an obligation of the government. Proposed amendments to the Justices of the Peace Act would streamline the process for considering applicants for appointment as justices of the peace by the Justices of the Peace Appointments Advisory Committee.

Strengthened Transparency and Accountability

To enhance the transparency and accountability of government, the Province has:

• enacted the Fiscal Transparency and Accountability Act, 2004, which sets new standards for government resource planning and reporting, and requires the Ministry of Finance to release a pre-election report on Ontario’s finances for review by the auditor general
• expanded the role of the auditor general to examine institutions in the broader public sector
• consolidated hospitals, schools and colleges into the Province’s financial statements.

In light of newly fixed election dates, as detailed in Chapter II: Ontario’s Economic Outlook and Fiscal Plan, the government intends to further enhance transparency and accountability by proposing the Interim Appropriations Act. If enacted, the act would give the government legal spending authority from the start of the fiscal year, through the general election.

Management of Government Resources

Information and Information Technology

Over the past two years, Ontario has progressed towards becoming an e-government, with a focus on expanding electronic service delivery in order to provide cost-effective 24/7 access to government information and services. By driving down costs and increasing efficiencies, the government has reduced spending on information and information technology (I&IT) by $100 million.

High-volume public service transactions are less costly and faster now, using e-channels rather than previous manual processing:

• Online legal aid billing has reduced costs by 25 per cent and processing time by 69 per cent from April 2005 to May 2006.
• Online parental support payments cost 85 per cent less to process than paper cheque transactions and are posted to client accounts within 36 hours — compared to 10 days for paper cheques.

Use of electronic channels for government service delivery is increasing. The Province’s new Internet portals, whose central site is www.ontario.ca, are growing in popularity. Other one-window portals serve the needs of various groups. For example, www.ontarioimmigration.ca offers useful information for prospective and new immigrants on what they need to know before and after they arrive, and provides links to programs and services to support their successful integration into Ontario. Global Experience Ontario, recently established and funded from internal efficiencies, is a one-stop resource centre to help internationally educated non-medical professionals find out how to qualify and apply for practice in Ontario.

Implementing the government-wide Integrated Financial Information System has been a major driver of improved operational efficiency and program effectiveness. This system replaced three core financial systems and 73 other legacy systems. Legislators and the public now receive complete and current financial information. Financial roll-ups are completed in half the previous time. Improved forecasting and cash-flow management allow the Province to reduce borrowing costs.

Continued automation of the Ontario land registry system under contract with Teranet has dramatically increased efficiency — now 85 per cent of land registrations are filed electronically and 87 per cent of Ontario property records are automated. Although demand for registrations has risen 50 per cent over the past five years, new, more efficient processes have met the demand without new funding.

The government is expanding the use of videoconferencing for more cost-effective interoffice meetings and interviews, avoiding travel costs and time, particularly for offices in remote locations.

Human Resources

A modern public service values its employees and nurtures their capacity to learn, lead and thrive in a changing environment. The government is developing future leaders, promoting effective partnerships with bargaining agents, and working to ensure that public servants have the skills they need to transform government and deliver excellent services, now and in the future. For example:

• Updated public service legislation strengthens the fundamental principles of public service: transparency, accountability, non-partisanship, competency and professionalism.
• Settlements reached with the government’s major collective-bargaining agents have meant uninterrupted services to the public, with lower labour cost increases than in the BPS.
• The Ontario Public Service (OPS) Innovation Fund, established to promote innovation and transformation across government, has supported 35 projects over the past two years with potential annual savings of up to $5 million — for example, a victim services portal for victims of crime, service providers and the public; a useful video for disability support applicants; and access to satellite images to assist in emergencies such as forest fires.
• The OPS has initiated a Youth and New Professionals Strategy to help attract and retain quality public servants, with a special focus on students, including aboriginal youth, and internationally trained professionals.

Efficiencies have allowed the government to reinvest in the OPS by hiring more staff for priority programs, including:

• 160 health care workers
• 185 social assistance workers
• 285 security, probation and parole officers
• 120 safe drinking water and nutrient management staff
• 155 food safety officers and meat inspectors
• 200 workplace health and safety inspectors
• 650 staff transferred from the federal government for employment training and services
• 130 natural resources staff.

As well, the government has hired 470 staff as a result of the government’s decision to operate the Central North Correctional Centre.

At the same time, Ontario has the second-lowest number of public-sector employees per 1,000 population among the provinces and territories.³

To lower costs and retain skilled staff, the government has reduced reliance on expensive consultants for the services Ontarians need by approving the conversion of 944 temporary positions to full-time posts, with efficiencies of approximately $37 million annually.

Ontario’s transformation to a modern, efficient government involves fostering a culture of continuous improvement. Ministries review programs, services and administrative processes on an ongoing basis. This ensures that government takes every opportunity to achieve efficiencies and reinvest in cost-effective and sustainable services for Ontarians.

¹ Expenditure Estimates of the Province of Ontario, 2003–04 and 2006–07.
² Statistics Canada, Public Sector Statistics, Financial Management System, 2005/2006. Consolidated provincial and territorial government revenue and expenditures.
³ Statistics Canada, Public Sector Statistics, Financial Management System, 2005/2006. Consolidated provincial and territorial government revenue and expenditures.