PCs to open up Ontario’s books
The days of ‘phoney’ numbers over, Fedeli says about province’s finances
Finance Minister Vic Fedeli will reveal the state of Ontario’s books in the fall economic statement on Nov. 15.
It will be a “mini-budget” meaning there are expected to be some tax changes and further spending cuts.
“The days of phoney numbers in Ontario are over,” Fedeli told reporters on Thursday.
“We will present to the people of Ontario for the first time in a long time a true and current state of finances in the province,” he said.
Premier Doug Ford’s Progressive Conservatives, who toppled former premier Kathleen Wynne’s Liberals in the June 7 election, have been claiming Ontario has a $15-billion deficit.
But that inflated number includes $5.7 billion in Liberal election promises that the Tories do not plan to keep.
As well, it is based on auditor general Bonnie Lysyk’s disputed accounting treatment that does not count $11 billion in government-sponsored public pension plans, which are worth $5 billion on the annual bottom line.
Lysyk and her predecessors booked the holdings as an asset starting in 2002, but she changed her mind two years ago after a tiff with the Liberal government.
A panel of independent experts hired by Liberals — and led by the chair of the Canadian Actuarial Standards Oversight Council — concluded last year she was wrong.
Fedeli, however, noted the Tories will continue to use Lysyk’s accounting for the time being.
In the Liberals’ March 28 budget, Wynne’s government forecast a $6.7-billion deficit for 2018-19.
Using the different account- ing method, the auditor general estimated in her report that the shortfall is $11.7 billion.
But Ford’s independent “financial commission of inquiry,” headed by former B.C. Liberal premier Gordon Campbell, warned the new government should only adopt Lysyk’s accounting method on a “provisional basis” while negotiating with her.
“It would seem reasonable that the government should be able to recognize a portion of an asset it jointly controls with another party,” Campbell’s report concluded on the joint-sponsored Ontario Public Service Employees’ Union Pension Plan and the Ontario Teachers’ Pension Plan.
“Given the risks and uncertainties involved, they may not feel it appropriate for the government to recognize its full 50 per cent share of the surplus. By the same token, however, it seems unlikely they would conclude the value to be zero.”
Interim Liberal leader John Fraser said he expects Fedeli’s fall economic statement to reflect the government’s bent for axing measures brought in by the Liberals.
“That’s going to continue. The car’s in reverse and it doesn’t look like they’re taking their foot off the gas,” said Fraser, predicting the Nov. 15 deficit will be billions lower than the Tories’ $15-billion tally because they’re cancelling Liberal initiatives.
“I suspect you might see a lower number they will take credit for.”