The spectre of a $5.6-billion deficit in Ontario is false, and shows the new Liberal government is not prepared to make the tough choices needed to keep the provincial budget balanced, Progressive Conservative Party Leader Ernie Eves said yesterday.
"Just roll up your sleeves and get to work," Mr. Eves challenged Premier Dalton McGuinty, who has spent the past several days warning that the higher-than-expected deficit number will force the Liberals to delay delivery on several campaign promises.
Mr. Eves, in his first defence of his own record since the election, promised he will challenge the government on its intention to run a deficit when the legislature resumes sitting after a Speech from the Throne on Nov. 20.
"I'm saying it's certainly possible [to balance the budget]if the government of the day is committed to doing that," he told reporters at Queen's Park.
Mr. McGuinty announced the date of the Throne Speech yesterday. The legislature will convene on Nov. 19 to elect a new Speaker, likely veteran Liberal MPP Alvin Curling.
Mr. Eves said the widely heralded figure of the projected deficit is based on questionable accounting and revenue assumptions made by former provincial auditor Erik Peters in a report presented to the government last Wednesday.
Instead, the former premier estimated the projected deficit at a maximum of $1.7-billion and argued that this could have been covered by selling assets such as the Liquor Control Board of Ontario or transforming it into an income trust.
"You're looking at a deficit of $1.7-billion, not $5.6-billion," he said. If there is improved economic performance for the next five months, "the number would be more in the neighbourhood of $1.3-billion or $1.2-billion."
This could be dealt with easily, he suggested.
"Obviously, we had talked about selling assets to raise that money. And there's still half a fiscal year left to do that. I think, quite frankly, this all comes down to whether the government of the day has the will and they are determined to balance the books or they are not."
Mr. Eves also said that he plans to stay on as leader for at least a year, although he would step down earlier if the Conservative Party found an earlier time to choose a successor.
"I think that I owe to my party some continuity and some consistency as we move from one leader to the next leader. . . . These things take time and they take money," he said.
Mr. Eves noted that in his nine-page review of the government's fiscal situation, Mr. Peters himself had stressed it was not an audit because that can be done only after the fiscal year-end on March 31.
He also asked why the Liberals have not revealed the terms of reference that directed Mr. Peters, and would have gone a long way to determine whether he found a deficit was likely and its size.
For example, Mr. Eves challenged the inclusion in Mr. Peters' calculations of the $700-million cost of capping the price of electricity at 4.3 cents per megawatt hour. The Liberals plan to increase this cap to cut the cost to the government of the program, introduced by Mr. Eves on Nov. 11 last year.
He also said the government still has time to achieve the $800-million in savings in ministry operations which the Tories planned.
Further, Mr. Eves noted that earlier yesterday, federal Finance Minister John Manley announced Ontario would get the $771-million in additional payments for health care excluded from Mr. Peters' assessment.
And Mr. Eves contended that the new government should be able to pick up another $500-million from the federal government to help pay the costs caused by the outbreaks of severe acute respiratory syndrome.
Another $200-million would come from the sale of Teranet, which is partly owned by the provincial government.
Mr. Eves pointed to the improved U.S. economy as another benefit that would eat away at the supposed $5.6-billion deficit.