Premier Kathleen Wynne will stake her government on the largest new social program this country has seen in a generation, placing a provincial pension proposal at the heart of Thursday's budget.
The Ontario Retirement Pension Plan will be modelled closely after the Canada Pension Plan and at least four other provinces have sent representatives to the advisory body overseeing it, reinforcing the national significance of the policy, The Globe and Mail has learned. The idea, Liberal insiders say, has tested well with voters nervous about their meagre savings in a difficult economy, and will be the Premier's central pitch in the event of a spring election.
The ambitious budget – which also contains considerable new spending on everything from subways to daycare workers to social services to business grants – clearly positions Ms. Wynne's government as an activist administration bent on leaving a major legacy.
"What I believe is that at this point in our history in Ontario, there is a need for investments that are strategic," the Premier said Wednesday during a photo-opportunity at a Toronto fire hall. "That is what is going to allow our economy to be competitive. Those investments and the proposals we're bringing forward in our budget are necessary for the future of the province."
With the Liberals controlling only a minority of seats in the legislature and the Progressive Conservatives vowing to vote against the budget, Ms. Wynne needs the support of the New Democrats to pass the spending plan and avoid an election.
But despite the budget's aggressively progressive bent, NDP Leader Andrea Horwath was non-committal Wednesday.
"We're going to take our time," she told reporters. "We'll let you know when we're going to get back to you."
Ms. Wynne suggested she would only have so much patience for Ms. Horwath. Asked if she would call an election herself if the NDP takes too long to decide whether to back the budget, Ms. Wynne said: "I am not going to rule anything out."
A government source said the ORPP will be designed so it can be rolled into CPP if a future federal government embraces pension reform.
Currently, the Conservative government in Ottawa is opposed to enlarging CPP, arguing that forcing businesses to pay more will hurt the economy.
The Ontario retirement savings system will be run at arms-length from the government, likely as a non-profit. Payouts will be tied to the size of a worker's contribution, similar to CPP, and people will have a rough idea of how large their retirement benefits will be, sources said. The government is also considering ways of pooling its assets with other, already existing plans for government employees, in order to make larger investments.
Ms. Wynne has previously said other provinces will be welcome to join the plan. Four of them – British Columbia, Alberta, Manitoba and Prince Edward Island – have members on her pension advisory body. This does not mean they will necessarily join the plan, but they are all taking a close look at what Ontario is doing.
Finance Minister Charles Sousa argued earlier this week that better pensions will ultimately help the economy by making sure people have more money to spend in retirement.
"When we increase savings for our employees, that in the end will increase disposable income," he said. "It'll enable those pension companies to reinvest in our economy."
The budget is also meant to draw a sharp contrast with the Tories, who are pitching a government-shrinking plan, including slashing spending, cutting business taxes and ending subsidies to wind and solar power projects.
"[The budget] is purely tax and spend," PC finance critic Vic Fedeli said in an interview. "We can't keep spending money we don't have – this is our grandkids' money we're spending now."