Ontario Finance Minister Charles Sousa, who will deliver a budget in the coming weeks, says he will beat his deficit target of $12.5-billion for the current fiscal year, helped in part by a lower Canadian dollar, reduced oil prices and the economic recovery in the United States.
Mr. Sousa is expected to unveil the new figure Tuesday at a major prebudget luncheon speech to the Toronto Region Board of Trade. He has not yet announced the budget date and it's not expected he will do so in his speech.
As Ontario's budget approaches, two other provincial budgets released last week – in Alberta and Quebec – are providing interesting contrasts. Oil-rich Alberta, usually solidly in the black, is showing a deficit and a bleak economic future, given the oil-price meltdown. Quebec, in deficit territory for years and traditionally dependent on federal transfer payments, has presented a balanced budget and is promising economic growth.
Ontario's budget – Mr. Sousa's third as Finance Minister – is expected to come somewhere in the middle. In an interview Monday, Mr. Sousa said he will not deviate from his plan, laid out in last year's budget, to balance the books by 2017-18.
Last year, the government announced $130-billion in spending and projected a deficit of $12.5-billion for 2014-15.
He said that his coming budget will not put anyone in Ontario in "harm's way." For example, it is not expected that the government will make dramatic cuts to health care or education.
Quebec took some hard decisions in its budget. Social programs, for which the province is known, were singled out. Daycare costs are increasing and fertility programs for women were eliminated as part of $1.2-billion in spending cuts.
Alberta, meanwhile, announced a record $5-billion deficit and raised income taxes.
Mr. Sousa is painting a positive picture of Ontario's recovery from the recession. He said that 500,000 jobs have been created since the 2008 recession and that Bank of Canada Governor Stephen Poloz's interest-rate decrease in January has helped with investment.
But all is not rosy – the province has a huge debt. Late last year, the provincial Auditor-General said that Ontario's debt will have increased to $325-billion by 2017-18, more than double the level of 10 years ago.
A centrepiece of Mr. Sousa's budget is expected to be the money that will be raised from the sale of assets such as Hydro One.
The Globe and Mail reported that the Ontario government is planning to sell shares in Hydro One as part of its plan to partially privatize the utility.
Ed Clark, the former CEO of Toronto-Dominion Bank, is advising the government on this as well as how to make more money from two other Crown corporations, the LCBO and Ontario Power Generation. The money earned from Hydro One and these other assets would be used to fund Premier Kathleen Wynne's $29-billion transit and infrastructure plan.
Mr. Sousa says he is meeting most days with Mr. Clark as they work toward the budget.