Ontario faces a whopping deficit of about $18-billion over this year and next, says Finance Minister Dwight Duncan.
He disclosed in a luncheon speech Tuesday the extent to which the global economic crisis has pushed Canada's biggest province into the red.
“A deficit is not something that we take lightly,” Mr. Duncan said in the speech at the Canadian and Empire Clubs. “It is however, a necessity in these challenging times.
He plans to hand down the provincial budget on March 26.
A spokeswoman for Mr. Duncan said the province will post a combined deficit in the range of $18-billion during the fiscal years ending March 31, 2009, and March 31, 2010.
Governments across Canada and around the world are “wrestling” with the economic challenges, Mr. Duncan said in his speech.
As revenues have declined and as the global crisis hits businesses, governments around the world are slipping into deficit, he said.
By way of example, he noted that energy-rich Alberta had until recently expected to post a surplus of $8.5-billion this year. Last week, however, the Alberta government announced that it would post a deficit of $1.4-billion.
The federal government is facing a deficit of $64-billion over two years, he said.
The size of Ontario's deficit will, in proportion, be well below that of the United States and also lower than what the province experienced in the last recession in the early 1990s, Mr. Duncan said.
The budget will include a short-term stimulus package to help create jobs as well as lay out a plan for future growth.
“I think we all know there is no simple fix,” he said.
