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Showing posts from November, 2015

Ontario overestimates deficit -- for the seventh year in a row

Shocker.  The Ontario government is forecasting that it will beat its deficit forecast -- for the seventh year in a row.
The deficit for this year is forecast in the province's Fall Economic Outlook and Fiscal Review to be $1 billion less than forecast in the spring 2015 Budget.  The forecast for next year is already $300 million less than in the 2015 Budget.  That would make eight years in a row.
For this year, the decline in the deficit was driven by higher than expected revenue ($1.245 billion more revenue,  primarily due to an underestimation of revenue from the Hydro sell-off and $600 million higher than forecast revenue from personal income and land transfer taxes).  Lower than expected interest expense on debt ($140 million) has also helped. 
Program spending however is $397 million higher than expected.  The major in-year increases in spending compared with the 2015 Budget are in two areas, the Hydro privatization and the new Green Investment Fund:

The Liberals usually end up …

Canadian hospital funding now 25% more than Ontario funding

Provincial government per capita expenditures on hospitals continue to decline.  This is the third year of absolute decline according to Canadian Institute for Health Information (CIHI) data.

Of course hospital services are also affected by inflation, like other services.  One way to measure this is the total health care price index.   CIHI  reports the health care implicit price index over this three year period has increased by approximately 8.3% (160.9/148.6). That is equal to about 2.7% per year.
This inflation means the 2012/13 per capita hospital funding would have to increase to $1,534.95 in 2015/16 just to keep up with increasing health care prices.  Instead the government expended just $1395.73.
In other words, in three short years, the government has reduced real spending on hospital services by 9.1% per person ($1395.73/ $1534.95). If we considered the impact of an aging population on hospital costs (usually put at about 1% per year in extra costs), the real cut in funding wou…