• Policy Issues & Updates

  • Policy Papers for 2017-18

    Provincial Policy Papers

    Closing the Gap on Financial Literacy for Ontario's Youth


    Given the current levels of unprecedented household debt and an increasingly complex financial system, Canadian youth must be educated about the intricacies of current day personal finance including borrowing, investing and taxes.

    In the summer of 2017, EQAO test scores revealed that half of Ontario’s grade six students failed to meet provincial standards in math. Education Minister Mitzie Hunter acknowledged the problem amid calls to overhaul the math curriculum. Troubling as these results may be, the lack of basic math skills is not merely an academic concern. According to the National Balance Sheet and Financial Flow Accounts released September 15, 2017, by Statistics Canada, Canadian households borrowed $28.9 billion in credit market debt and $16.5 billion in mortgage debt. Consumer credit and non-mortgage loans increased by $6.1 billion to $12.3 billion. Conceptualized at a household level, Canadians borrowed $1.68 for every dollar of disposable household income.

    Climbing household debt is increasingly concentrated among younger Canadians, with the most indebted borrowers tending to be under 45 years of age.Young Canadians are taking on record levels of debt from several sources including post-secondary education, big-ticket purchases such as homes and vehicles, and credit cards.

    As a group, younger Canadians tend to have inadequate financial knowledge to navigate the complexities of present-day personal finance. According to a PriceWaterhouse Cooper study, only 24% of millennials demonstrate basic financial literacy and only 8% showed a high level of financial literacy. In the 2017 BMO wealth management survey directed towards millennials, 23% of survey participants cited paying down debt as the highest financial priority. Further, 41% reported that retirement was too far away for them to consider saving for retirement and that paying down debt was a more immediate concern

    It is imperative that youth in Ontario graduate high school as financially literate young adults or these troubling statistics will only worsen. A consumer debt crisis is brewing.


    The Ontario Chamber of Commerce urges the Government of Ontario to:

    1. Create elementary and secondary-level courses according the the Ministry of Education’s Transformation Steering Committee’s guidelines to address the following:
      1.  The fundamentals of Canadian banking system;
      2.  Calculating and understanding various types of debt such as compound interest, bank loans, OSAP, credit cards, lines of credit, secured and unsecured loans, and mortgage payments;
      3. Retirement planning;
      4. Saving;
      5. Securities;
      6. Financial products such as RESPs, RRSPs, and TSFAs; and,
      7. Basic income tax.
    2. Provide regular continuing professional development training for teachers required to teach this aspect of the curriculum with measurable standards teachers are required to meet.
    3. Involve various stakeholders such as banks, credit unions and the province’s accounting body to assist with curriculum development.
    4. Implement a standardized survey or test for students participating at various levels of this curriculum requirement to measure financial literacy rates among youth in Ontario.



    Diverting Mental Health from the Criminal Justice System


    Since the closure of many Ontario institutions serving individuals with mental illness, the criminal justice system has become a repository for individuals who lack adequate resources to cope with living in the community. The costs associated with this are spiraling out of control – both in terms of the financial burdens placed on local police services (and by extension, municipalities), courts and corrections; not to mention the devastating costs to individuals with mental health issues who are forced to navigate a system that was never intended to be therapeutic. These costs also directly impact the business community since business encompasses a large percentage of the municipal tax base.

    Because many individuals who have mental illness are without timely access to care, communities are often negatively impacted as those affected are more prone to addiction, unemployment, homelessness and sometimes crime. On the surface the aforementioned issues appear to be all of a social nature, but looking deeper these issues impact the Ontario economy as a whole.  The loss of these individuals from the work force could impact Ontario’s competitiveness, especially in a time when demographically the retired will soon outnumber the working. More businesses could benefit if those with mential health issues were provided with the conditions necessary for them to have meaningful employment and make a contribution to the economy.

    The related homelessness and perceived potential for crime among those with mental illness can impact small businesses trying to get started in lower rent areas.  Additionally, small business can be impacted as governments (of all levels) look for new revenues to fund the growing costs of medicating the aforementioned social symptoms of mental illness. This is why the business community feels it is time to address the underlying issues to build a stronger workforce of the future.

    According to the Centre for Addiction and Mental Health (CAMH), the annual cost in Ontario of alcohol-related health care, law enforcement, corrections, lost productivity, and other problems is estimated to be at least $5 billion.  It is unknown how much addional cost will be added with the legalization of cannabis, however it is clear that in order to control costs, the government must be proactive.

    A growing body of international evidence demonstrates that promotion, prevention, and early intervention intiatives show positive returns on investment. For example, in the United Kingdom, preventing conduct disorders in one child through early intervention has been found to result in a lifetime savings of $365,000 from the criminal justice system, health system, and increases in lifetime earnings. With 85,000 children in Canada currently estimated to experience a conduct disorder, if just 10% (8500) of these cases were prevented, it could result in a total savings of $3.1B. Based on population percentages, over $1B of these savings could be in Ontario. And that is $1B that could be used to help make Ontario more competitive.


    The Ontario Chamber of Commerce urges the Government of Ontario through the Ministry of Health to:

    1. Focus on preventing persons with mental illness from entering the criminal justice system through programs offered by the Minstry of Health and Ministry of Children and Youth Services aimed at early diagnosis and treatment.
    2. Relieve pressure on local police services by providing funding for 24 hour crisis response teams for issues related to mental health.
    3. Develop a process whereby individuals who enter the criminal justice system are automatically screened for mental illness and provided with access to treatment when needed.
    4. Provide support and prevention measures for those with mental illness who are re-entering their communities after being involved with the criminal justice system.




    Ontario's Debt Reduction Strategy


    Ontario’s net debt, the difference between total liabilities and total financial assets, was $301.6 billion in in 2016-2017 – the highest of any non-sovereign jurisdiction in the world. While the Ontario Government’s formula for forecasting a balanced budget is being challenged by the Provincial Auditor General, the Ontario Government is nevertheless projecting a balanced budget in 2017-2018 and the forecast is to remain balanced through 2020. However, Ontario’s net cumulative debt has now exceeded the $300 billion mark. This should be a wake-up call, as that is more than double the $153.7 billion net debt of less than a decade ago.

    One of the strategies associated with prudent fiscal management is the need to be prepared for a downturn in the economy. In order for the Ontario Government to be prepared for the next economic downturn, it will have to produce surpluses and reduce the debt significantly over the next three years.  Economic cycles typically do not last far beyond 10 years, so we need to focus our preparations now to weather the next storm. 

    Furthermore, Ontario has the highest debt in Canada and the second highest debt per capita. The negative consequences of this unsustainable yet seemingly insatiable and chronic appetite for debt includes the huge servicing costs of that debt which divert funds away from critical government services and leaves Ontario vulnerable to interest rate increases as well the very real threat of credit-rating downgrades that lead to higher borrowing costs in future. Looking forward, apart from jeopardizing the sustainability of our public services, Ontario’s debt crisis will be a drag on our domestic business confidence as well as having a chilling effect on foreign direct investment.

    This massive debt also creates an intergenerational shift of the tax burden. Without a more robust plan to eliminate the ever increasing level of debt, we will be leaving that debt for future generations.


    The Ontario Chamber of Commerce urges the Government of Ontario to:


    1. Expand Alternative Service Delivery (ASD) in the health sector and replicate elsewhere where service quality can be improved and costs lowered. By opening up service delivery to the private and not-for-profit sectors, ASD models take advantage of market incentives to enhance productivity, achieve greater efficiencies, and harness new technology.

    a. Beyond its fiscal benefits, ASD accomplishes many other public policy objectives: ASD enables government to leverage private sector investment to modernize the delivery of public services. • ASD enables government to access new and innovative business models. • ASD facilitates the commercialization of government intellectual property and business processes.

    b. Utilizing ASD in specific services, such as the back-office reconciliation of Ontario Health Insurance Plan transactions and frontline services like Service Ontario, can help the government save money while preserving (or even enhancing) its capacity to deliver valuable services.

    2. Adopt a formal policy on asset recycling. In Ontario, asset recycling could be one method of reducing the province’s large infrastructure deficit, in the context of a reduced fiscal capacity. The Premier’s Council on Government Assets is a good start, but the government must adopt a broader policy that applies to more government assets and regularizes the review process. In spite of the many non-action recommendations of the Premier’s Council on Government Assets, the Government must move aggressively on this recommendation if the “Maximizing Assets” pillar of the Treasury Board is to have any meaning or impact.

    3. Tackle the underground economy to increase revenues by establishing tougher penalties for noncompliance and a stronger focus on high-risk industries. The 2012 Drummond Commission estimated that strengthened compliance measures could yield over $500 million per year for the province. Without addressing this problem more aggressively, fewer and fewer Ontario businesses will be paying the bulk of Ontario’s taxes while those that don’t continue to grow.

    4. Apply more rigor to regularly mandated program reviews across all ministries and departments that re-examine the programs, services, and operations of government ensuring that these are aligned with citizens’ expectations of government. Furthermore these reviews should begin with the mandatory questions: Should government be engaged in this activity? Is this policy accomplishing what we want? How do we know? Are there other programs across government that are duplicative? The Ministry of Finance should consider a cash pooling arrangement within and between all departments and ministries whereby any annual budget surpluses (or unspent money) could be allocated by the Finance Minister to either pay down debt or re-allocated to other departmental/ministerial projects instead of borrowing to finance them. Departments/ministries would then be able to re-apply for that money in the next following budget year.\

    These reviews should also determine how programs and services align with government priorities, help reduce spending, and where appropriate achieve savings by identifying redundancies and inefficiencies. In this way, program reviews can make government more effective and responsive. They can also be used to “rejuvenate the public service by eliminating unsuccessful programs and strengthening effective ones. By answering the questions posed above, governments can redirect public resources away from non-essential programs and services, and toward core ones

    5. Establish Outcomes-based Incentives and Accountability in the Public Service Sector. Closely linking incentives and accountability for public servants to specific outcomes can increase the efficiency of government, improve program and service quality, and help the government do more with less. If the government is to move toward fiscal sustainability, it will need to take steps to enhance its return on investment and ensure that desired outcomes are being achieved at the desired cost. a. Public sector compensation is the most accessible tool to achieve this outcome. For example, instead of cancelling pay-for-performance incentives, government should reinvigorate them for all levels of the public service and tie them to specific and measurable financial outcomes.

    6. Adopt user-pay models for government services. This means that part or all of service operating costs are met by the end user. In other words, the government puts a price on a program or service. Depending on the price, user-pay can be used to partially or fully cover the cost to government of providing the service.

    a. In Ontario, adopting user-pay models for specific government services could be a method of maintaining current service levels and quality in the context of a reduced fiscal capacity and increased demand for services. Currently, many government services in Ontario are funded entirely out of general revenue. This means that all citizens pay for these services, regardless of whether or not they use them. By appropriately applying user-pay to some of these services, government could continue to provide them, while reducing the amount of money it contributes.

    b. User fees also help regulate and mitigate unnecessary or fraudulent demand and encourage more efficient use of public services.

    c. Example: Transport for London UK (TfL), London’s public transit agency, introduced a congestion charge in central London. The congestion charge acts as a user fee for roads in downtown London: during working hours, motorists are charged a tariff for bringing their vehicle into a designated area of the city. As a user pay scheme, the congestion charge has successfully acted to regulate the demand for road infrastructure and raise revenues.

    7. Adopt a Means Testing provision for specific services. Means testing means that recipients with greater means may be asked to make a greater contribution to the cost of that service. Many services and benefits in Ontario are currently available to all Ontarians at the same upfront cost (often at no charge), despite significant variation in people’s financial means.

    a. Adding a means-testing provision to the price of a service takes into account an individual’s ‘ability to pay’. From a fiscal perspective, means testing can be a method by which government secures additional funds by reducing access for those with higher incomes. Individuals with greater means will pay more for a means-tested benefit or service.

    b. By varying the cost of or access to a service based on means, it can also increase the efficiency and effectiveness of government spending. Means testing reduces spurious demand, thereby increasing access to those that require the service.

    c. Example: Australia integrated means-testing into residential aged care as part of a reform package. The government reduces the amount it contributes toward the care and accommodation of individuals with greater financial means. This is one strategy that Australia is taking to increase the sustainability of aged care, in the context of an aging population similar to that of Ontario.

    8. Investigate cost saving alternatives for the location of provincial back office functions to save on real estate, wages, and cost of living.

    9. Review the option to enhance the marketing and sale of Ontario Saving Bonds where the return on investment would improve the provincial debt management position including the investment of surplus cash in the bond program rather than in external financial markets.




    Policy Papers for 2015-2016

    Federal Policy Papers


    Strengthening the Canada Pension Plan to Support the Most At-Risk Canadians


    According to a 2014 report written by McKinsey and Company, approximately 17% of Canadians currently do not have sufficient combined public and private financial resources (pensions and savings) in place to adequately provide for their retirement years. If not addressed, there is the risk that these individuals will not only be left with a significantly lower standard of living but that they will put additional pressure on an already strained public social system.

    The needs of these individuals however often conflict with those of business. Adding too many additional costs to business owners in the form of additional CPP contributions or other payroll taxes may have the unintended consequence of stifling growth in these companies, which will only further exacerbate the problem.


    That the federal government:

    1. During the course of any reforms to CPP, promote the use of existing private financial products such as Group RRSPs, Personal RRSPs, Life Insurance,         Stock Purchase Plans, etc.   For example, individuals could have the option to contribute retirement savings to these products rather than to participate in increased CPP contributions. These products could consist of “locked-in” accounts in order to ensure that the funds will still be available when the individual retires.
    2. That any reforms to CPP are aimed specifically at targeting the 17% of Canadians who are not saving enough for retirement. As noted by Finance Minister, Bill Moreau in his interview with the National Post, enhancements to CPP should be fully funded by those who will actually use it.  For example, if it is determined in an individual’s Notice of Assessment that they are saving below a certain threshold (by percentage or dollar amount), it could trigger an additional automatic CPP contribution. 
    3. Promote a greater degree of financial literacy among the public through educational programs which specifically focus on helping Canadians understand how much they need to save for retirement and which types of financial products are available to help them do this.
    4. That in order to mitigate the cost to business and its effect on the economy that reforms to CPP be phased in over a period of 5 to 10 years and to be delivered within CPP’s current spending envelope.



    Fuelling Job Growth Through Innovation


    Technological changes offer diversification opportunities and strengthen existing industries for the long-term growth of the Canadian economy. As innovations happen within industries, those innovations often are a result of new or enhanced forms of technology. As Marc Andreesen of Houston-based venture capital firm Andreessen Horowitz once remarked, “Software is eating the world.” When looking at almost any vibrant industry in today’s economy, it is usually technology that underpins opportunity and growth within the industry.

    Having a focus on innovation in all sectors and the Canadian tech sector in particular can better balance and grow the Canadian economy by increasing employment, increasing export revenue, better situate Canada to attract new talented immigrants, and re-engage Canadian talented youth once lost to more attract employment opportunities most notably in the US.


    That the federal government:          

    1. Distribute more funding programs through already established regionalized efforts (e.g., RICs, post-secondary, etc.) and establish local panels - with adequate successful entrepreneur representation - for awarding such funds to better match funding with the best companies capable of growing. Meeting the entrepreneur and understanding the underlying opportunity should be a requirement when issuing grants to ensure the funding is providing maximum impact to the economy.
    2. Create new funding programs that are designated for established innovative technology companies that are in growth-mode. Supporting proven companies lowers the risk of funding defaults, lowers the amount that will leave Canada or sell to foreign companies, and maximizes the overall benefits on our Canadian economy.
    3. Match funding programs with clear measurement targets built against key metrics that improve the Canadian economy. Efforts should be made to ensure federal funding in this area is results oriented and driven to reliably grow the Canadian economy.
    4. Lower the burden on Canadian entrepreneurs by creating a harmonized system and eliminate duplication between provincial and federal funding program applications.
    5. Create or help enhance a national network(s) that is committed to established Canadian companies – typically in the $2-20M revenue range - in the acceleration stage, connecting them not only with funding sources but programming opportunities which include mentorship, formalized education, peer-to-peer learning, and export opportunities.
    6. Incentivize Canadians – especially entrepreneurial individuals in the Science & Technology industry - to come back to Canada by providing incentives (e.g., premium tax deduction on moving expense deduction).



    Additionally, the London Chamber of Commerce was asked to co-author the following policy paper with the Prince George Chamber of Commerce and Atlantic Chamber of Commerce.

    Canada’s Small Airports and Access to ACAP Funding

    The paper recommended that:

    1. That Transport Canada increase ACAP funding for all regional and local eligible airports, with the inclusion of the six NAS airports currently excluded, to account for inflation and increased project costs.
    2. That Transport Canada stream line communications and make the application process more transparent so that airports can complete the process in a reasonable timeframe and be able to follow the progress of the application.
    3. That Transport Canada revise the ACAP requirements to include the six small NAS airports that are currently excluded due to their status so that they may fulfill their obligations as NAS airports without financial hardship and remain as large supporters of economic growth within their communities and regions.


    Provincial Policy Papers

    Regulating the Sharing Economy for a Competitive Ontario


    Technology is leading to innovations that are disruptive to the status quo and the sharing economy is one area where the evolution in the marketplace is moving at an exponential pace. Our province’s economy has been stagnant for some time and many Ontarians are naturally looking for ways to boost their incomes. One such method that has become popular in recent years is participating in the sharing economy.

    By working with the sharing economy providers, rather than against them, our province can become a leader in this sector, grow our economy and help Ontarians grow their incomes thereby increasing the provincial tax base. We must change outdated structures and legislation to make the most out of these opportunities while maintaining the safety of the public.


    That the provincial government:

    1.Produce regulatory criteria for sharing economy entities in the business of transportation so that the public is protected while not being too burdensome that the provisions limit the provider and the consumer from creating adequate value. It being noted that criteria in other jurisdictions should be considered so as not to create an uncompetitive environment with other markets.

    2.Modernize legislation to address the unique nature of the sharing economy. This new legislation should focus on specific areas in which the sharing economy is already thriving such as lodging, and transportation while remaining flexible to address the sharing of other personal property or services as new platforms arise. 

    3.Make provisions to ensure existing businesses are not unduly harmed by the sharing economy. Opening a closed market penalizes entrepreneurs who sought to build a business within the confines of the legislation at a given time.

    4.Implement a fair tax system within the sharing economy. The creation of internet based solutions that coordinate services locally without a physical local presence reduces municipal tax revenues as a result of both reporting deficiencies and the absence of a local tax base for the coordinating entity. A system must therefore be devised by which fair portion of local taxes to be collected from platform administrators.




    Positioning Ontario to be a Global Leader in Smart City Development


    Ontario cities are in a race with other cities throughout the world to become “Smart Cities”.

    A Smart City can be defined as a city that uses new forms of information and communication technology (ICT) to tackle challenges such as traffic congestion, fighting crime, providing social services, fostering economic growth, and improving the delivery of city services.

    The diminishing cost of IT infrastructure has created the potential for an “Internet of Things” – a ubiquitous network of connected devices, smart sensors, and big data analytics. The ability to collect instantaneous feedback through smart devices allows for the creation of Living Labs, which can give members of the community direct input concerning municipal services and assist in continued research for the development of even more efficient and effective uses of technology.


    That the provincial government:

    1.Commit to funding and/or tax incentives to assist Ontario municipalities engaged in Smart City initiatives which have already been proven to enhance competitiveness and improve quality of life. Emphasis should be placed on incentives involving Public Private Partnerships

    2.Identify qualified cities/neighbourhoods within Ontario which the government can support in the creation of research/testing environments. This may include testbeds for “Internet of Things” IoT applications, Living Labs, and multi-sector collaborative models.

    3.Once the Government of Ontario has programs underway to facilitate the creation of Smart Cities, it must then leverage its position to attract new business and investment by marketing Ontario globally as Canada’s first “Smart Province.”     

  • Policy Papers Completed during the 2014-2015 Year

    Federal Policy Papers

    Restoring Business Competitiveness to Canada’s Anti-Spam Legislation


    The Canadian Anti-Spam Law (CASL) came into effect on July 1, 2014. The Act governs software and the sending of electronic messages for commercial purposes.

    The US has a similar act called The CAN-SPAM Act (2003). CASL deviates from CAN-SPAM in a number of areas but most notably CAN-SPAM works on an ‘opt-out’ model. In an opt-out model, an individual or business may send an electronic message that’s commercial in nature (what CAN-SPAM calls a commercial electronic mail message or CEMM) to someone but the sender must provide the recipient a means to unsubscribe.

    CASL, on the other hand, has adopted an ‘opt-in’ model. Senders may only send a commercial electronic message (CEM) if they acquire consent first or meet an exception.

    The Act also requires, under certain types of consent, people to be removed from the email list after a length of time has passed (‘existing business relationship’ and ‘existing non-business relationship’ rules).


    That the federal government:

    1. Change the definition of ‘implied consent’ to include any mutual interaction between two people. Interaction between two people or two companies would then naturally create mutually implied consent.
    2. Remove the time limits on existing business relationships (EBR) and existing non-business relationships (ENBR). Currently, recipients can unsubscribe easily at any time from CEMs they receive. Time limits on consent therefore are an unnecessary and burdensome piece of the legislation.
    3. Assume two connected people or businesses on an existing social network (eg. Facebook, Linkedin, etc.) to already have implied consent.
    4. Remove the “Right of Action” from CASL. While individuals should still have the right to report inappropriate CEMs to federal regulatory bodies, they should not have the right to sue senders in the civil court system. 


    Strategic Public Infrastructure for a Competitive Canada


    Public infrastructure investments are linked to enhanced productivity, job creation, and income growth. They also enhance the health and quality of life of Canadians and our communities. Unfortunately, our country faces a significant public infrastructure challenge due to a long period of underinvestment in maintaining existing stock, combined with a growing need to modernize infrastructure such as public transit, roads, water and wastewater, the power grid, and modern telecommunications such as fiber-optics.

    Canada needs a national infrastructure investment plan that involves all levels of government, targeted at opportunities that will yield the greatest economic benefits. The Federal government must lead the way, coordinating with provincial and municipal partners to introduce a wide range of innovative financing tools, including new mechanisms for raising revenue from both private and public sources that provide stable and predictable financing on an ongoing basis.


    That the federal government:

    1.    Lead the development of a new long-term stable, predictable infrastructure plan that involves all levels of government, and includes a clear mechanism for sharing costs amongst the federal, provincial, and municipal levels of government.

    2.    Reviews global best practices in public infrastructure financing, and investigates the feasibility of introducing new public and private financing tools that deliver value for the money invested.

    3.    Ensures that investments in public infrastructure are targeted to projects that result in the largest net gains for the economy, and must include strategic investments in Canada’s major economic hubs, gateways, and public transit systems.

    4.    Validates the effectiveness of P3 (public-private partnerships)  projects to ensure that all parties are able to efficiently manage those projects so that they result in a quality product that is delivered in a timely manner with a reasonable return on investment.


    Provincial Policy Papers

    WSIB Reforms for a New Generation


    The foundation of the current WSIB system is the principles established by Chief Justice Sir William Meredith during his 1910-1914 review.  In order to ensure the sustainability of an injury/illness disability program, fundamental changes that are more reflective of today’s workplace within an increasingly difficult business climate are urgently required.


    Recommendation Highlights:

    The Chamber made numerous recommendations on this issue including improvements to accountability and transparency, broader competition for insurance services, more efficiencies in the use of funds, and asset management.

    While the recommendations made by the Chamber are too extensive to list in their entirety, the following are some of the highlights: 

    1. That the WSIB system should be included in the Auditor General’s reports until the unfunded liability is fully retired.  The Auditor General should provide an independent review of the status of the unfunded liability and assess the degree to which the WSIB has complied with the statutory requirement for a phased in retirement of the debt.
    2. That the WSIB work closely with other Ministries, Agencies, Boards and Commissions especially on management of health care and return to work/job strategies.  WSIB benefits should be better co-ordinated with Ontario Works and the Social Assistance Program.
    3. Strategies were recommended to ensure broader competition for insurance services for employers.
    4. Financial strategies were recommended including that the WSIB maintain an employer cost-based experience rating program to encourage return to work and hiring disabled individuals.
    5. That the WSIB should support the recommendations from the Harry Arthurs and Doug Stanley reports.
    6. The WSIB should undertake a policy review, with stakeholder consultations, of physical-mental, mental-mental, and mental-physical conditions.  This is timely given the recent Workplace Safety and Insurance Appeals Tribunal (WSIAT) decision on traumatic mental stress.
    7. The WSIB should review the efficiency and effectiveness of the current Board organizational structure including the value to the WSIB system of a Toronto-based head office and regional/satellite offices.



    Ontario’s Debt and Deficit Management Strategy


    Ontario’s net debt, the difference between total liabilities and total financial assets, was $267.2 billion in 2013-2014. The Ontario Government is projecting a deficit of $12.5 billion in 2014-2015 and has pledged to eliminate it by 2017-18. However, by that year, Ontario’s net cumulative debt will have ballooned to an estimated $325 billion. That’s more than double the $156 billion net debt of just a decade ago according to Ontario’s Auditor General, Bonnie Lysyk in her December 2014 report.

    In order for the Ontario Government to eliminate its deficit by 2017-2018, it will have to reduce the deficit by over $4 billion per year for the next three years.

    Furthermore, Ontario has the highest debt in Canada and the second highest debt per capita. The negative consequences of this unsustainable yet seemingly insatiable and chronic appetite for debt includes huge servicing costs which divert funds away from critical government services and leaves Ontario vulnerable to interest rate increases as well the very real threat of credit-rating downgrades that lead to higher borrowing costs in future. Looking forward, apart from jeopardizing the sustainability of our public services, Ontario’s debt crisis will be a drag on our domestic business confidence as well as having a chilling effect on foreign direct investment. 

    This massive debt also creates an intergenerational shift of the tax burden.  Without a more robust plan to eliminate the annual deficit and ultimately reduce the current level of debt, we will be leaving that debt for future generations to pay for.

    Recommendation Highlights:

    Recommendations centered around improvements to alternative service delivery, asset recycling, tackling the underground economy and better review processes to ensure the effectiveness of government programs.

    While the recommendations made by the Chamber are too extensive to list in their entirety, the following are some of the highlights: 

    1. Expand alternative service delivery (ASD) in various sectors including health.
    2. Adopt a formal policy on asset recycling.
    3. Tackle the underground economy to increase revenues by establishing tougher penalties for noncompliance.
    4. Apply more rigor to regularly mandated program reviews across all ministries and departments.
    5. Establish outcome-based incentives and accountability in the public service sector.
    6. Adopt user-pay models for government services.
    7. Adopt a means testing provision for specific services.
    8. Adopt new provincial polices on education that would decrease inefficiencies (eg. Adjusting educational subsidies to promote in-demand career paths).
    9. Stand down programs or policies that are hurting Ontario businesses (eg. Ontario Registered Pension Plan).