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Ontario tightens purse strings, Tories don’t plan to balance books until 2023-24

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  • TORONTO — Ontario’s books won’t be balanced within the Progressive Conservatives’ mandate, but the government’s first budget serves up an era of gradual belt-tightening with a side of booze.

    The Tories peg the current deficit at $11.7 billion, and they don’t expect to eliminate the red ink until 2023-24. Drastic and widespread cuts that many had feared did not materialize in this budget, but the path to balance shows that much of the heavy lifting comes at the halfway mark to the next election, and after it.

    The budget constrains spending growth — and shows cuts in post-secondary and social services — but the $163.4 billion package is still nearly $5 billion larger than the last budget from the previous Liberal government, who the Progressive Conservatives often slam for their spending habits.

    “We have developed a reasonable path to balance,” Finance Minister Vic Fedeli said. “Our path to balance in five years is a thoughtful and a measured approach to take…Our entire premise is to protect what matters most.”

    Program expenses will rise over three years by an average of 0.8 per cent, compared to the 3.3 per cent in growth that the former Liberal government planned.

    One new goodie is a child-care tax credit, providing up to $6,000 per child under seven and up to $3,750 per child between seven and 16, on a sliding scale for families earning less than $150,000 annually. It’s expected to cost about $390 million a year. They are also promising to create 30,000 child-care spaces over five years.

    Free dental care will also be provided for low-income seniors.

    The government is also loosening rules around alcohol, allowing municipalities to legalize drinking in parks, letting licensed establishments start serving alcohol at 9 a.m., permitting happy hour advertising, and legalizing tailgate parties. The government also intends to put beer and wine in corner stores.

    The opposition parties questioned why Premier Doug Ford’s government was “obsessed” with booze.

    The budget also reveals a new Ontario trillium logo — virtually identical to a previous iteration — as well as a largely blue licence plate redesign and an accompanying new slogan, “A place to grow.” The government spent $500,000 on a consultation on branding, but has a new contract for licence plate production that saves $4 million.

    NDP Leader Andrea Horwath said the blue licence plate is obvious Conservative branding.

    “It is … use of public money for partisan purposes,” she said. “It’s just shameful that this is a priority of Doug Ford, to have his ego on the back of everybody’s car.”

    “I think it will cause a lot of rear-ending,” she joked.

    But Horwath said that even in areas where spending is increasing, it’s mostly below the rate of inflation, which she said amounts to cuts.

    Hospitals are getting an additional $384 million, which amounts to an increase of 2.05 per cent, but the Ontario Hospital Association had said the sector needs a 3.45-per-cent increase to maintain staffing levels.

    Overall health spending is set to rise over three years by a modest annual average of 1.6 per cent, with Ontario’s move to roll more than 20 health agencies into one expected to save $350 million a year by 2021-22. Moves billed as “workforce productivity,” such as reducing overtime, are expected to save $250 million a year.

    Education spending is set to rise by 1.2 per cent, but that growth is largely due to higher student enrolment, instead of new programs. Ontario recently announced a host of education changes, including larger high school class sizes, which sparked widespread anger.

    The post-secondary sector will see funding cuts, with spending dropping one per cent on average for the next three years, largely due to changes to student financial assistance.

    Universities and colleges will also see more conditions on their money, with up to 60 per cent of post-secondary funding tied to institutional performance over the next five years. The government could not specify what criteria will be used to evaluate performance, saying it will work with institutions to develop them.

    Changes such as social assistance reforms, closing spaces and facilities in the youth justice system, and “streamlining” administration are expected to help reduce children’s and social services sector costs by $1 billion — or two per cent — over three years.

    The justice sector is expected to see about two per cent in cost cuts too, including changes to legal aid and victim compensation services and amalgamating adjudicative tribunals.

    Ontario has also started looking at how to constrain growth in public sector wages.

    For businesses, faster write-offs on capital investments are expected to provide $3.8 billion in corporate tax relief over six years. That allowance is instead of cutting the corporate tax rate from 11.5 per cent to 10.5 per cent, as the Tories had promised in the election. They say this move will benefit businesses more.

    Ontario Chamber of Commerce president and CEO Rocco Rossi said if he had to choose between the two measures he prefers the capital allowance.

    “We have been lagging significantly in terms of productivity measures vis a vis our global competitors — this is an important step,” he said. “We’d like to see, eventually, that corporate tax rate come down.”

    The budget contains no new taxes. In addition to tackling the deficit, the government is also taking aim at the net debt — currently pegged at $343 billion — through ensuring surpluses and unused reserve or contingency funds go to paying it down.

    As well, planned legislation would require the government to develop a debt burden reduction strategy, and make the premier and finance minister pay 10 per cent of their salaries for each missed reporting deadline for documents such as the budget and quarterly economic accounts.

    Allison Jones , The Canadian Press

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    National

    Canada-China relations hit ‘rock bottom’ and at ‘freezing point’: Chinese envoy

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  • OTTAWA — China’s ambassador to Canada says the bilateral relationship is now at “rock bottom” compared to any time since diplomatic ties were first established decades ago.

    In prepared text for a speech Thursday, Lu Shaye said he’s saddened Canada-China relations are at what he called a “freezing point.”

    Lu’s remarks come at a time of heightened tensions following the December arrest of Chinese telecom executive Meng Wanzhou in Vancouver on an extradition request by the United States.

    The Huawei executive’s arrest has enraged China, which has since detained two Canadians on allegations of endangering Chinese national security, sentenced two Canadians to death for drug-related convictions and blocked key agricultural shipments.

    Lu did not mention Meng’s arrest — but he said the China-Canada relationship is now facing serious difficulties.

    He said China has long valued its relationship with Canada, particularly since it was one of the first Western countries to establish diplomatic ties with the Asian country.

    “For clear reasons, the current China-Canada relations are facing serious difficulties and are situated at the rock bottom since the two countries have established diplomatic relations,” said a copy of Lu’s speech, which was posted on the Chinese Embassy’s website.

    “It saddens us that the current China-Canada relations are ‘at a freezing point’ and face huge difficulties. The knots shall be untied by those who got them tied.”

    He continued by urging Canada to view China’s development in a “fair and objective” manner and to respect its concerns. Lu also warned Canada to “stop the moves that undermine the interests of China.”

    In recent months, Beijing’s envoy has used strong words when talking about the relationship. In January, he told Canadian journalists that Meng’s arrest was the “backstabbing” of a friend and said it was evidence of white supremacism.

    Lu also warned of repercussions if the federal government bars Huawei from selling equipment to build a Canadian 5G wireless network.

    He made the remarks in Toronto at an event hosted by the Globe and Mail. The document said former prime minister Jean Chretien was in attendance as was Darryl White, chief executive of BMO.

    The Canadian Press

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    Environment

    Keep guard up against hurricanes in 2019, as risk remains potent: forecaster

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  • HALIFAX — It has been years since a major tropical storm wreaked havoc in Canada, but the Canadian Hurricane Centre is warning against complacency.

    The U.S. National Oceanic and Atmospheric Administration released its hurricane outlook Thursday, predicting nine to 15 named storms this season, with four to eight becoming hurricanes and two to four being major hurricanes.

    Bob Robichaud of the Canadian centre noted that’s similar to last year’s hurricane season, when only two storms hit Canada, including post-tropical storm Chris, which made landfall in Newfoundland in July 2018.

    However, Robichaud warns that some Atlantic Canadians may be forgetting storms like post-tropical storm Arthur, which snapped trees and caused massive power outages in 2014, and hurricane Juan’s widespread wrath in 2003.

    And he reminded journalists attending a briefing in Halifax about hurricane Michael, which flattened parts of the Florida panhandle last October.

    The Halifax-based centre has created a fresh smart phone app, and recommends people begin tracking storms as soon as they start and then monitor for shifts in direction and intensity.

    “What we advocate is for people to really stay in tune with weather information because the forecast can change as the storms are approaching,” Robichaud said.

    Robichaud says studies show that complacency levels rise about seven years after a storm like hurricane Juan, and that as a result people do less to prepare.

    “People tend not to take any preparedness action if they haven’t had any kind of hurricane in recent years,” said Robichaud, a warning preparedness meteorologist.

    “For us it’s been five years since any major impactful storm … so it’s even more important to take the necessary precautions to get ready.”

    The Intact Centre on Climate Adaptation at the University of Waterloo has published a simple guide for Canadians on basic measures to take to prepare in particular for flood risk from extreme weather.

    The centre has repeatedly pointed out that without basic measures, basement flooding can cause tens of thousands of dollars in damage during hurricanes.

    Its publications include a Home Flood Protection Program that begin with such simple steps as testing sump pumps, cleaning out eaves troughs and maintaining backwater valves.

    More advanced measures include removing obstructions from basement drains and creating grading to move water away from homes.

    The hurricane season runs from June 1 to early November.

    Robichaud said hurricanes tend to “feed on” warmer waters, and as result the centre is closely monitoring those trends.

    The meteorologist said as summer progresses it’s projected the water will warm in the eastern Atlantic and become warmer than average.

    In addition, Robichaud said the Atlantic Ocean continues to be in an overall period of high hurricane activity that hasn’t yet come to the end of a cycle.

    — Follow (at)mtuttoncporg on Twitter.

    Michael Tutton, The Canadian Press

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