Skip to main content

Ontario revenue up $1.5 billion since November - but no new health care spending announced

Ontario’s third quarter finances came out yesterday.  They confirm that although planned health care funding has increased $404.1 million since the 2019/20 Budget, no further increase has been achieved since November's Ontario Economic Outlook and Fiscal Review. 

 While the lack of new progress since the fall is disappointing, the $404.1 million is a 0.64% funding increase for health care since the Budget.  Total health care funding for 2019/20 is now planned to increase 3.1% since 2018/19.

Also notable:
  • Total revenue is projected to be $157.2 billion in 2019–20, $3.1 billion higher than the 2019 Budget projection and $1.68 billion higher than expected in the fall 2019 Ontario Economic Outlook and Fiscal Review.
  • Program expenses are $2.45 billion higher than in the 2019/20 Budget. The total increase for the year compared to last year is $3.9 billion (so far).  So, in the Budget, program funding was increased 0.91%, while, since then, program funding was increased a further 1.63%, for a total increase of 2.56%.  Clearly, the Budget is far from the whole story in terms of actual expenditures.  In this case, most of the new funding was won after the Budget.  Indeed, this rather minor third quarter report saw most of the in-year increase and 43% of total increase achieved this year -- $1.68 billion out of a total $3.9 billion. The government, apparently, is retreating from its harsh austerity --which has been under significant attack from popular forces.  
  • Notably the 2019–20 Third Quarter Finances “includes additional funding to help keep Ontarians’ electricity bills more stable and affordable”.  This newly announced spending accounts for $1.56 billion, or over 60% of the increase in program expenses since the Budget and virtually all the new program expense announced since the Fall Economic Outlook.   Subsidies to electricity bills will not help reduce greenhouse gas emissions. 
  • Increased total expenses have been moderated by falling interest rates which has resulted in $630 million in debt savings since the 2019/20 Budget, including $200 million since the fall’s Ontario Economic Outlook and Fiscal Review
  • The deficit projection remains at $9 billion – although that includes the $1 billion originally set-aside as a reserve.  At this late stage in the fiscal year (which ends March 31), this probably means most or all of the reserve will simply be used to reduce the deficit.  Notably, they say “additional details on the Province’s fiscal performance for 2019–20 will be provided in the 2020 Budget.”   
  • Economic growth in 2019 is projected to be up to 1.7% from the Ontario Economic Outlook and Fiscal Review forecast of 1.5%

Bottom line – As expected, the fiscal situation is better than the PC government projected.  The PCs are spending that windfall on their political priorities, rather than reducing the deficit.  Unfortunately, since the fall Ontario Economic Outlook and Fiscal Review, those spending priorities have not included health care  -- and so the crisis of under-capacity continues. 
Labels:

Comments

Post a Comment

Popular posts from this blog

Huge cuts in public sector wages predicted

The Ontario Financial Accountability Office (FAO)   says  that, with inflation, real wages in the public sector will decline 11.3% over the three year period  2021/2 - 2023/4 .  This would radically deepen the trend towards lower wages during the last ten years.   The FAO reports that since 2011, the average annual salary for the Ontario public sector employees (defined here as employees of schools, colleges, provincial government, provincial agencies, and hospitals) has increased by $10,385   -- or 1.6 per cent on average annually.  This is the lowest increase of all the sectors and lower than inflation, which averaged 1.8 per cent per year. Over the ten years that would be about a 2% pay cut.   The FAO reports that wage settlements were the lowest in the provincial public sector over the last decade:   Hospital Wages Especially Challenged: The FAO predicts hospital wages will increase even less than in the public sector  -- just ...
Post a Comment
Read more

Too many public sector workers in Ontario?

Opponents of public services often try to portray the public sector as having grown disproportionately.  In fact, since 1976, the number of public sector employees has not quite kept pace with the population. In 1976, the number of public sector employees in Ontario  as reported by Statistics Canada averaged 830,800.  By 2012, the number had increased to 1,330,700 -- a 60.2% increase.  That sounds like significant growth -- true. But the population has increased  from 8,413,779 in 1976 to 13,505,900 in 2012, a 60.5% increase.   In other words, population growth has run slightly ahead of the growth in public sector employment.     In 1976, close to 10% of the population worked in the public sector.  It stayed pretty much this way until the Mike Harris government came to power when it dipped below 9%.  It returned close to the historical range in the last six years or so, declining in 2012 to below the 1976 averag...
16 comments
Read more

Are health care administrative expenses out of control in Ontario?

The Progressive Conservative government has justified its health restructuring plans with the claim that administrative expenses are much higher in Ontario than in Canada.  When introducing the reforms, health minister Christine Elliott  claimed , “Over the last five years, Ontario has spent 30% more than the Canadian average in administrative expenses on its health care system.”   Elliott did not indicate her source of information. Presumably, however, the Progressive Conservatives are referring to the CIHI simplified and user friendly “ Your Health System ” graphs. Those graphs show “administrative expenses” in Ontario at 5.8% in Ontario while it is 4.5% in Canada.   This CIHI measure is actually fairly narrowly defined. It is the percentage of “the legal entity’s” total expenses associated with the administrative, finance, human resources and communications functional centres. However “the legal entity” used for this estimate is [1] only...
Post a Comment
Read more