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Ontario taxpayer watchdog calls $237 billion provincial debt ‘scary’

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When Dalton McGuinty and the Liberal Party took over the province of Ontario more than a decade ago, taxpayers were promised an open and transparent government that would not raise taxes, spend money it didn’t have or turn it into a have-not province. Billions of dollars later, the province is now nearly a quarter of a trillion dollars in debt.

The Canadian Taxpayers Federation (CTF) published a report a Monday and held a news conference at Queen’s Park to highlight the “scary” $237 billion provincial debt and to urge the Premier Kathleen Wynne government to institute a number of reforms to begin tackling the debt loads.

“It’s time for the government to be smart about its budget. They need to stop throwing good money after bad and get rid of programs that have failed the province,” said CTF’s Ontario director Candice Malcolm in a statement. “We are calling for smart government and a focused approach at Queen’s Park.”

The provincial government has been spending more money than it takes in – otherwise known as deficit spending – since the collapse of the global economy in 2008 and 2009. The Wynne government projected to balance the books within the next three to four years, but Finance Minister Charles Sousa says Queen’s Park will not be reducing public services in order to reduce the budget deficit or to cut down on the provincial debt.

The CTF has recommended the following initiatives:

  • Cut full-day kindergarten ($1.5 billion)
  • Crack down on sick day abuse by public workers
  • Sell off the LCBO
  • Eliminate the 30 percent off tuition grants
  • Get rid of the 10 percent break on hydro bills ($1 billion)

Other suggestions put forward by Malcolm include freezing pay in the public sector, ending grants to private businesses, clawing back defined benefit pension plans and ending plans to move ahead with a brand new Ontario Pension Plan – instead CTF suggests giving taxpayers more of their money back so they can pay for their personal retirement.

One idea being floated by the organization to make sure the provincial government pays down the debt is to institute a law that requires debt repayment.

“Instead of shirking responsibility for the debt and kicking the can down the road to future taxpayers, we want a law requiring this government to pay back the debt it has borrowed over the last decade,” said Malcolm. “The CTF has demonstrated that it is possible to balance the budget and get Ontario back on track. It’s time for the government to follow our lead.

“Instead of watching the numbers on the debt clock continue to spiral upwards, the government should listen to taxpayers and make adjustments to their program spending. This will put Ontario back on the right track of economic growth and fiscal responsibility.”

The interest on the provincial debt is expected to rise from the current $10.6 billion to $14.5 billion in 2017 and 2018. Interest payments are presently the fourth-largest line item in budget following Health, education and children’s and social services.

The Ontario Finance Minister is scheduled to speak to the media regarding the spring budget this week. Meanwhile, a spokesperson for Sousa, Susie Heath, told the Toronto Sun that the government has gone beyond their own deficit reduction targets for the past four years.

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