November 5, 2020
Ontario Prepares for Second Wave & the Future with Pandemic-Oriented Budget
The Ontario government has tabled its 2020-21 budget, committing $45 billion in support over three years to protect, support and recover from the devastating social and economic fallout from the pandemic.
In total, Finance Minister Rod Phillips said Ontario's COVID-19 health response is now a projected $15.2 billion.
The government is also planning to invest $4.8 billion in initiatives that will support jobs now, while removing barriers that would hold Ontario back from a strong recovery.
Among the major initiatives proposed are a reduction in electricity prices and reducing provincial business property tax rates to a rate of 0.88 per cent for 94 per cent of all business properties in the province. The government said this will create $450 million in annual savings in 2021, representing a 30 per cent reduction for many employers.
The budget also reaffirmed the province's ongoing capital investments to help restart the economy, create jobs and create much-needed infrastructure such as transit, highways, schools, hospitals and broadband. Planned capital investments over the next decade total $142.9 billion, including $13.6 billion in 2020–21.
The government is projecting a deficit of $38.5 billion for 2020-21, which is unchanged from the deficit forecast at the time of the 2020-21 First Quarter Finances.
The infrastructure-related budget highlights include:
- $62.7 billion over 10 years for public transit projects such as the Ontario Line and the Eglinton Crosstown West Extension;
- $22 billion in funding over 10 years to expand and repair Ontario’s highways and bridges, including $2.6 billion in 2020–21;
- $18 billion in capital grants over 10 years to build new and expanded hospital infrastructure and address urgent upgrades, including repairs and maintenance to help modernize hospitals across Ontario;
- New funding of more than $680 million over the next four years, bringing Ontario’s investment in broadband to nearly $1 billion; as well as
- Funding for the Investing in Canada Infrastructure Program, including more than $1 billion in federal and provincial funding under the newly established COVID-19 Resilience stream to support health and safety through the accelerated delivery of priority municipal infrastructure projects as well as investments to retrofit schools and long-term care homes.
- The government said it also remains committed to investing $1.75 billion to increase long-term care capacity and access for residents by building 30,000 long-term care beds, which will include air conditioning for any new and redeveloped homes.
- Ontario is fast-tracking the development of four new long-term care homes in Mississauga, Ajax and Toronto to create 1,280 long-term care beds by the end of 2021.
- The province has also introduced a modernized funding model, which will help speed up construction by making needed changes to the Construction Funding Subsidy (CFS) and introducing a new upfront capital investment recognizing the unique regional challenges faced by long-term care operators.
- Ontario also called on the federal government to reduce delays in federal approvals for current infrastructure projects and step up with an additional $10 billion per year over 10 years for shovel-ready projects.
- The province is seeking at least 40 per cent of total costs for its $28.5-billion subway plan for the Greater Toronto Area and is actively pursuing federal funding for broadband to support specific projects and regional development opportunities and advocating to accelerate the building of essential broadband infrastructure.
The 2020 budget, entitled Ontario's Action Plan: Protect, Support, Recover, can be accessed here.