addisonwesley
September 27th, 2005, 01:36 PM
By KAREN HOWLETT
Tuesday, September 27, 2005 Posted at 4:49 AM EDT
From Tuesday's Globe and Mail
The Ontario government is a lot closer to fulfilling its promise to balance the province's books by 2009 with the surprising revelation that the deficit shrank to $1.6-billion in the most recent fiscal year.
This is well below Finance Minister Greg Sorbara's two most recent forecasts. In the budget tabled last May, he said the deficit for the fiscal year that ended March 31 would come in at $3-billion. Two months before that, he pegged it at $6-billion.
An official in the Finance Ministry attributed the dramatic improvement to higher revenue from corporate taxes and better management of the province's finances.
“I think this shows that our plan is working and that we are taking a balanced and responsible approach to eliminating the deficit while continuing to make essential investments in education, health and the economy,” Sean Hamilton, a spokesman for Mr. Sorbara, said last night.
The ministry will release more details on the ever-shrinking deficit today when it publishes the public accounts for the fiscal year 2004-2005. But opposition members were quick to criticize the government's oft-changing financial projections and “accounting tricks.”
In his latest pronouncement on the deficit last May, Mr. Sorbara said the Liberal government would break a campaign promise to balance the books by the fiscal year 2007-2008. He said the government would need an extra year.
The Finance Minister could find himself revising that timetable yet again. At the same time, however, there is no guarantee that the province's corporate sector will perform as well as it did last year.
In the past several months, Ontario politicians have painted their province as financially troubled. Premier Dalton McGuinty has been waging a campaign for a fairer financial deal from Ottawa since last February. He has said that the gap between what Ontarians pay in taxes to the federal government and what they get back in programs and services has swelled to $23-billion from $2-billion in 1995.
As well, Mr. Sorbara said last week that the government is closely monitoring the toll that skyrocketing oil prices and a rise in the value of the Canadian dollar are taking on the province's economy.
Higher oil prices, now more than $65 (U.S.) a barrel, raise the cost of doing business in Ontario and reduce disposable income for consumers. The higher dollar, now trading at more than 85 cents (U.S.), makes Ontario's products more expensive on international markets.
Mr. Sorbara has been conservative about the province's prospects for some time. He estimated in the budget that the economy would grow 2 per cent this year — a figure now in line with private-sector forecasters, who recently lowered their growth estimates.
“We think we're still on target, but we had budgeted on the basis of oil at $50 a barrel,” Mr. Sorbara told reporters last week in Kitchener, Ont., at the Liberal party's annual caucus retreat.
New Democrat Leader Howard Hampton said he is not surprised that the deficit is well below the government's estimate. He said the province has more revenue simply because it has not kept a promise to increase rates for social assistance and it is forcing municipalities to pick up more costs.
“You can very quickly find the money by taking it out on someone else, in this case municipalities and the poorest people in the province,” Mr. Hampton said in an interview. He said he expects more “accounting tricks.”
Progressive Conservative finance critic Tim Hudak said Mr. McGuinty's government has published four different financial plans since it assumed office two years ago. None has proved to be accurate, he said.
“In fact, the Liberal budget should go directly to the fiction section of your local library,” he said. The Liberals consistently miss their targets by spending more than they said they would and by raking in greater revenue from taxpayers, he added.
GOD DAMNIT, WRONG FORUM.
Tuesday, September 27, 2005 Posted at 4:49 AM EDT
From Tuesday's Globe and Mail
The Ontario government is a lot closer to fulfilling its promise to balance the province's books by 2009 with the surprising revelation that the deficit shrank to $1.6-billion in the most recent fiscal year.
This is well below Finance Minister Greg Sorbara's two most recent forecasts. In the budget tabled last May, he said the deficit for the fiscal year that ended March 31 would come in at $3-billion. Two months before that, he pegged it at $6-billion.
An official in the Finance Ministry attributed the dramatic improvement to higher revenue from corporate taxes and better management of the province's finances.
“I think this shows that our plan is working and that we are taking a balanced and responsible approach to eliminating the deficit while continuing to make essential investments in education, health and the economy,” Sean Hamilton, a spokesman for Mr. Sorbara, said last night.
The ministry will release more details on the ever-shrinking deficit today when it publishes the public accounts for the fiscal year 2004-2005. But opposition members were quick to criticize the government's oft-changing financial projections and “accounting tricks.”
In his latest pronouncement on the deficit last May, Mr. Sorbara said the Liberal government would break a campaign promise to balance the books by the fiscal year 2007-2008. He said the government would need an extra year.
The Finance Minister could find himself revising that timetable yet again. At the same time, however, there is no guarantee that the province's corporate sector will perform as well as it did last year.
In the past several months, Ontario politicians have painted their province as financially troubled. Premier Dalton McGuinty has been waging a campaign for a fairer financial deal from Ottawa since last February. He has said that the gap between what Ontarians pay in taxes to the federal government and what they get back in programs and services has swelled to $23-billion from $2-billion in 1995.
As well, Mr. Sorbara said last week that the government is closely monitoring the toll that skyrocketing oil prices and a rise in the value of the Canadian dollar are taking on the province's economy.
Higher oil prices, now more than $65 (U.S.) a barrel, raise the cost of doing business in Ontario and reduce disposable income for consumers. The higher dollar, now trading at more than 85 cents (U.S.), makes Ontario's products more expensive on international markets.
Mr. Sorbara has been conservative about the province's prospects for some time. He estimated in the budget that the economy would grow 2 per cent this year — a figure now in line with private-sector forecasters, who recently lowered their growth estimates.
“We think we're still on target, but we had budgeted on the basis of oil at $50 a barrel,” Mr. Sorbara told reporters last week in Kitchener, Ont., at the Liberal party's annual caucus retreat.
New Democrat Leader Howard Hampton said he is not surprised that the deficit is well below the government's estimate. He said the province has more revenue simply because it has not kept a promise to increase rates for social assistance and it is forcing municipalities to pick up more costs.
“You can very quickly find the money by taking it out on someone else, in this case municipalities and the poorest people in the province,” Mr. Hampton said in an interview. He said he expects more “accounting tricks.”
Progressive Conservative finance critic Tim Hudak said Mr. McGuinty's government has published four different financial plans since it assumed office two years ago. None has proved to be accurate, he said.
“In fact, the Liberal budget should go directly to the fiction section of your local library,” he said. The Liberals consistently miss their targets by spending more than they said they would and by raking in greater revenue from taxpayers, he added.
GOD DAMNIT, WRONG FORUM.