Ford government plans to spend its way out of pandemic deficit

With a focus on economic recovery, the province's fall economic statement promises to build new highways. Mark McAllister reports on a new "staycation" tax credit and what critics say is still missing.

By Mark McAllister and Richard Southern

Increased spending on infrastructure projects, including new highways, and tax credits for families to enjoy a staycation over the next year highlight the Ford government’s fall economic statement (FES).

The “Build Ontario” plan includes $148.1 billion in spending on capital projects over the next 10 years, an increase of $2.7 billion since the 2021 budget was announced in March.

At the same time, the province now has a projected deficit of $21.5 billion in 2021-22, which is $11.6 billion lower than previously forecast. That’s expected to decrease even further and drop below $20 billion in 2022-23.


Commitments are being made to build both Highway 413 from Vaughan to Milton and the Bradford Bypass north of the GTA, however no specific costs have been pegged for the projects. Overall, spending on provincial highways is budgeted for $23 million over the next 10 years.

Finance Minister Peter Bethlenfalvy says the province continues “figure out” how much the projects will cost but says the construction of the 413 alone would create 3,500 jobs and contribute $350 million to the economy.

“We’ll continue to put money aside as we go through the process of planning,” says Bethlenfalvy.

Liberal leader Steven Del Duca contends the proposed highway plans are just a mirage.

“This project will take at least 10 years to complete, and will cost at least $10 billion,” said Del Duca. “And it may very well be told, despite what Doug Ford says between now and election day.”

Other previously announced highlights include $28.5 billion on transit projects like the Ontario Line, the three-stop Scarborough subway expansion and Yonge North Subway Extension.


Your next trip to the cottage or campground will be cheaper. The government is bringing in a one-time “Staycation Tax Credit” for the 2022 tax year.

The credit will give Ontarians 20 per cent off accommodations in Ontario up to $1,000 for individuals and $2,000 for families, up to a maximum of $200 or $400 respectively. It would apply to a stay in a hotel, motel, resort, lodge, bed and breakfast, cottage or campground.


As announced earlier this week, the government plans to raise the minimum wage to $15 an hour starting January 1, 2022 but beyond that there is nothing new to address the fast rising cost of living.

NDP leader Andrea Horwath says the spending doesn’t do enough to address the surging cost of living in the province.

“The premier’s buddies get everything, but everyday families get none of what they need,” says Horwath. “There’s no plan in here to address the housing costs, there’s no $10 a day childcare plan, there’s no help or relief on gas and auto insurance costs.”

While the Premier has said as recently as this week he plans to keep his 2018 campaign promise to lower the price of gas by 10 cents a litre, there is nothing about that in the statement.

When it comes to rising consumer price inflation the government says, “These price pressures, along with other factors are expected to ease over time.” The government projects inflation running at 3.1 per cent this year, but moderating to 2.6 per cent next year.


The government sees the hot housing market getting even hotter. The average home resale price in Ontario is expected to increase 19 per cent in 2021 “before moderating over the 2022 to 2024 period.” The government says it will establish a housing affordability taskforce.


Tax revenue from cannabis, although small relative to the overall budget, is expected to continue to grow. Provincial tax revenue from cannabis is projected at $108 million this year, growing to $185 million next year.

Tax revenue from beer, wine and spirits is expected to total $624 million this year, growing to $649 million in 2022.


The Ford government is also extending the jobs training tax credit to 2022. It’s a refundable personal income tax credit that helps workers get the training that may be needed.


Another tax credit that’s being extended is the Ontario Home Safety Tax credit for the 2021 year. It allows seniors to claim expenses for some home renovations including wheelchair ramps, grab bars, etc.


More money to support the identification, investigation, protection, and commemoration of residential school burial sites in Ontario is being promised by the province. Ten million dollars more will be spent over three years, bringing the total to $20 million.


When it comes to Ontario’s economy, the government projects it growing over the next two years before moderating.

GDP growth of 4.3 per cent in 2021, 4.5 per cent in 2022 and 2.6 per cent in 2023 is expected. Much of the government’s projected shrinking deficit is dependent on this economic growth actually happening.

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