In more bad news for the Ontario Liberals, the province’s deficit is now expected to jump to almost $12 billion because of higher spending in the Liberal government’s 2018 budget and weak revenue gains.
The Financial Accountability Office also says the government’s spending plan will add about $70 billion to the province’s net debt, increasing it to almost $400 billion in 2020-21.
The findings come in the FAO’s Spring 2018 Economic Outlook, released just a week before a provincial election campaign kicks off.
The Liberal government’s spring budget had estimated a deficit of $6.7 billion for 2018.
The FAO report warns that the plan to balance the budget by 2024 involves a dramatic cut in spending growth.
It says the government has provided few specifics about those spending cuts but says it would need to find $15 billion in reductions by 2025, or the equivalent of an eight per cent drop in program spending, to achieve its goal.
The report echoes some of the findings from the auditor general who said last week that the government had understated its deficit numbers in the 2018 budget, saying they were off by 75 per cent for 2018-2019, with that jumping to 92 per cent for 2020-2021. – CINEWS