Ontario’s financial watchdog says the province’s deficit will rise to $12.3 billion this fiscal year, half a billion more than he predicted before the spring election.
Financial Accountability Officer Peter Weltman says policy decisions such as cancelling the cap-and-trade program and reversing several tax increases, combined with a weaker economic forecast, contributed to the change.
In his fall economic and budget outlook, Weltman says that without further policy changes, the deficit is expected to exceed $16 billion by 2022-23.
He says that while the government’s fall economic statement did not include a budget forecast beyond this year, balancing the books in one mandate would require “significant changes” to policy that could have wide-ranging impacts on Ontario households and businesses.
The FAO’s spring report, issued just weeks before the provincial election, said the province’s deficit would jump to $11.8 billion in 2018 as a result of higher spending in the budget presented by the then-governing Liberals, as well as weak revenue gains.
The Liberals had projected a deficit of $6.7 billion, a figure that was also called into question by Ontario’s auditor general.
The Tories have since accepted the auditor general’s accounting but said a commission of inquiry and financial review convened to examine government spending found the province’s deficit will grow to $15 billion this year.
They said this fall that various savings measures had brought that number down to $14.5 billion.
The FAO says its projections do not include any election promises that the government has yet to act on or announce.