Ontario Budget 2016 - Key Highlights
Published on: 26/02/2016
On February 25, the Ontario Liberal Party introduced its Budget for 2016, making a number of ambitious spending announcements – including making post-secondary tuition free for families with incomes of less than $50,000 and forging ahead with its Ontario Retirement Pension Plan scheme. These increases in spending come in spite of slowing economic growth and a sizeable (but declining) budget deficit of $4.6 billion in 2016, and a provincial debt load that is expected to hit $308 billion in 2016. On the tax front, the roll-out of the new "cap-and-trade" system was identified and will include a new 4.3 cents per litre tax on fuel, among other levies.
Infrastructure investment continued to feature prominently in the Budget, with the 10-year funding outlay rolling forward, projected at $137 billion over the next decade.
Transit and transportation projects continued to be the primary focus of the government's infrastructure investment plan, with transfers to municipalities for their own infrastructure plans also remaining high on the list of priorities (Note: the province does not own any sewer and watermain assets, as they fall exclusively under municipal jurisdiction, therefore investments in these assets would be made through municipal transfers). The government will continue with its "asset optimization strategy" to replenish its infrastructure funds by selling off real estate assets and Hydro One stock and dedicating the accumulated capital to fund infrastructure works across the province.
Highlights of some of the key infrastructure and related commitments are listed below:
Investing Outside of the Greater Toronto and Hamilton Area (GTHA)
• Announced investments in 2016 include:
o $1 billion for transportation infrastructure development in Ring of Fire region;
o Ontario Community Infrastructure Fund increasing from $200 million to $300 million to support northern and rural municipalities for core infrastructure work;
o Small Communities Fund providing $272 million to support infrastructure projects in communities smaller than 100,000;
o Connecting Links program increasing funding from $15 million to $20 million to help municipalities pay for construction and repair to municipal roads; and,
o Numerous other transportation and LRT projects in London, Ottawa, Guelph, Kitchener, Prescott and Russell, and across Northern Ontario.
Investing in the GTHA
• Numerous highway improvement projects, including the widening of Highway 400 and 410, and adding High Occupancy Vehicle (HOV) and High Occupancy Toll (HOT) lanes to Highway 400, 410, and QEW.
• Long-term investments announced include:
o $13.5 billion to implement GO Regional Express Rail, quadrupling the number of weekly trips (two-way, all day rail service to Kitchener and Milton, and extending service to Niagara and Bowmanville);
o $1.4 billion to cover the capital construction costs of the Hurontario LRT line, expected to start construction in 2018; and,
o Up to $1 billion for a Hamilton LRT line between McMaster University and Queenston Traffic Circle, expected to start construction in 2019.
Additional Announcements of Interest
• $30 Drive Clean vehicle emissions test fee will be eliminated in 2017, but the test will still be required.
• The province is continuing with plans amend the Highway Traffic Act (HTA) to reclassify certain pieces of heavy equipment as vehicles by January 2017. Regulations and policy announcements are still pending.
• The WSIB unfunded liability has been reduced to under $7 billion, with the likelihood that the full debt load will be paid off by 2022, five years earlier than legislated. Paying off the debt will result in $2.4 billion in premium reductions, or a 40% average rate reduction.
• Ontario will bring forward legislative changes to the College of Trades as recommended by the Tony Dean Report. Some of these changes will include:
o An revision to the scopes of practice regulation (O.Reg 275/11);
o Review trades classification process to make it more evidenced-based and use risk of harm as a key criterion; and,
o Developing an enforcement and compliance committee and appeal process to resolve potential conflicts faster, as well as ensure enforcement activities are consistently carried out with safety and public interest in mind
• Amending the HTA for "Superload permits" to provide more options for escorts of loads, exploring enhanced permitting options, and creating Superload corridors.
• Expanding the Specialist High Skills Major (SHSM) and Dual Credit Programs in high schools to help an additional 2,600 students enter pre-trades training.
• Creating a Youth Job Link, starting in spring 2016, which will help students access job search resources and information to assist in transitioning to the labour market.
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