Ontario Fall Economic Statement

In June 2022 voters went to the polls in Ontario and re-elected the Ford Government and the Ontario PC Party to a renewed majority mandate. Since then, staffers and political decision makers have been formulating a plan on how to deliver on their party’s election promises to voters. On November 14th, Ontario's Finance Minister, Peter Bethlenfalvy, unveiled the government’s Fall Economic Statement (FES), a roadmap detailing exactly how those promises would be kept.  

In short, the FES followed the same theme as the election campaign: it promised to build the province’s economy, be a government that worked for workers and keep costs down for Ontarians, all while trying to remain flexible to respond to an everchanging economic environment. 

Key Priorities 

The government proposals in the Fall Economic Statement were built on 3 key pillars: 
Building Ontario’s Economy 
Working for Workers 
Keeping Costs Down 

Within these three themes, the government announced several key policies, including: 

The development of a voluntary Clean Energy Credit registry which would provide businesses with a tool to meet environmental goals.
Providing further tax relief to Main Street through the expansion of corporate tax cuts. 
Expanding the Ontario Disability Support Program earning exemption to allow Ontarians living with a disability to keep more of their wages.
Expanding Skills Development Fund, which supports training projects that upskill workers and job seekers.
Extending the gas and fuel tax cuts until December 31st, 2023. 
Doubling the Guaranteed Annual Income System (GAIS) payment, for low-income seniors, for one year, starting in January 2023

What is the Government Saying?

“We are in a time of elevated inflation that is straining household budgets by driving up prices on everyday goods and services. But I am confident in the resilience of Ontario’s economy, its workers and its people. And I remain confident in our government’s plan to maintain our fiscal flexibility, so we can provide targeted support to people and businesses today, while building for the future.” – Peter Bethlenfalvy,  Minister of Finance

“The 2021 Ontario Economic Outlook and Fiscal Review: Build Ontario is our government’s plan to support Ontarians by protecting our progress, building Ontario and working for workers, so that the province … can emerge stronger than ever.” – Sylvia Jones,  Deputy Premier

What is the Opposition Saying?

“Ontarians should be able to count on high-quality health care and education, and it takes investments to make that possible. Not only do we need action to protect our precious public services, but we need action to help people keep up with the bills. There’s plenty we can do to tackle the crushing cost of living — from helping people reduce their heating bills to making investments in affordable housing and restoring and expanding rent control.” – Catherine Fife, NDP Finance Critic

“Instead of doing what is needed to help Ontarians during difficult economic times, Doug Ford and the Minister of Finance are continuing to park billions of dollars in historically high contingency funds, short-changing our public services and families who are struggling to keep up with the soaring cost of living.” – Stephanie Bowman, Liberal Finance Critic

Our Analysis 
In the Fall Economic Statement, the government attempted to strike a balance between building on the promises made on the campaign trail earlier in the year, while also dealing with rising cost of living and preparing for a potential recession. 

In times of inflation, governments are often left between a rock and a hard place: while every politician wants to provide support to its constituents, too much government spending can further contribute to inflationary pressures. Overall, the measures announced provided targeted support for the most vulnerable, particularly with its expansion of the ODSP and top up of the GAIS payment for low-income seniors. Indirect support is also being provided to Ontarians through new investments in skills training and the continued cuts to the fuel tax. However, most programs are meant to provide incentive to businesses to invest and to support workers, especially as rising interest rates and higher costs of production discourage investment. 

While the government has made progress to help limit the impacts of inflation, and increase its reserves for a likely recession, healthcare and education have once again become the area of focus for many Ontarians. With continued negotiations with education unions, and hospital capacity challenges, it is likely that the government will continue to focus its attention on health care and education in the new year, and ultimately, Budget 2023.