Ontario set to see red
Ontario will be awash in red ink for the foreseeable future, butFinance Minister Dwight Duncan insists there is no danger of returningto the crippling shortfalls of the early 1990s.
Ontario will be awash in red ink for the foreseeable future, but Finance Minister Dwight Duncan insists there is no danger of returning to the crippling shortfalls of the early 1990s.
Duncan acknowledged Thursday the budget he is set to introduce in late February or early March will boast a more sizable deficit than the current $500-million shortfall.
“I don’t have hard numbers … but we’ve seen a deterioration of revenues in the private sector and in other public-sector organizations that have more up-to-date numbers, so I think it’s reasonable to expect that we will see a higher deficit figure,” he told reporters.
That’s not a surprise given the province will match billions in federal infrastructure funds and is participating in the $4-billion bailout of General Motors and Chrysler.
The Ontario budget, which will exceed $100 billion in spending for the first time, is expected to show a deficit of between $5 billion and $10 billion. Relatively speaking, such a shortfall would be well below the $34-billion federal deficit on a $258-billion spending plan.
More importantly, from a political standpoint, the Liberal deficit is unlikely to approach the scale of the 1991 budget of NDP premier Bob Rae and treasurer Floyd Laughren.
That recession-battling $52.7-billion spending plan featured a $9.7-billion deficit.
But NDP Leader Howard Hampton, who served in Rae’s cabinet, said he thinks the economic situation “is going to be worse.”
“Yes, the recession of 1990-91 was bad, but when things started to pick up, there were, in fact, factories and manufacturing plants to go back to,” Hampton said. “The McGuinty government has had no strategy to sustain manufacturing jobs and as a result … many of the facilities … will be permanently gone.”
Progressive Conservative Leader John Tory expressed concern the Liberals lack a long-term plan for the province’s economy.