Deficit Elimination $3.3 Billion Ahead of Plan
McGuinty Government Taking Strong Action to Preserve Services, Eliminate Deficit
Today the McGuinty government reported that the province's results for the 2011-12 fiscal year were $3.3 billion ahead of the plan projected in the 2011 Budget. The 2011-12 Public Accounts reported that the deficit was $13.0 billion, marking the third consecutive year in which the province has improved on its fiscal projections. This figure is also 47 per cent lower than the 2009-10 deficit of $24.7 billion forecast in the fall of 2009, at the lowest point of the global recession.
Program spending rose by only 0.9 per cent from the previous year, the second-lowest increase in 10 years.
The province used a $700 million reserve built into the fiscal plan to reduce the deficit.
At $109.8 billion, revenues were $0.5 billion above the forecast in the 2011 Budget. Higher-than-expected non-tax revenue more than offset the lower taxation revenue resulting from slower economic growth and lower-than-expected federal transfers.
At $122.7 billion, spending on programs and interest on debt was $2.2 billion less than forecast in the 2011 Budget. Lower-than-planned spending was achieved in most ministries and program areas, including health care.
Eliminating the deficit is the single most important thing Ontario can do to strengthen our economy, create jobs and protect what Ontarians have worked hard to gain.
- In 2011, Ontario’s economy expanded by 2.1 per cent, as measured by growth in real GDP. This was slightly below the 2.4 per cent growth projection used in developing the 2011 Budget.
- Ontario’s real GDP has recovered from the global recession of 2008-09. Including results for the first calendar quarter of 2012, Ontario real GDP increased by 7.5 per cent from its low point in the second quarter of 2009. It is now also above its pre-recession peak.
- In health care, the reduction in planned expense of over $1 billion was mainly due to savings in the Ontario Drug Program, lower post-construction operating spending by hospitals and higher-than-expected hospital surpluses.
- The Public Accounts of Ontario for 2011-12 present the financial statements of the province, provide financial highlights of the past fiscal year and report on performance against the goals set out in the 2011 Budget.
“While economic growth has returned to Ontario, it is more modest than we would like, so strong action is necessary to eliminate the deficit. The McGuinty government will stay the course and continue to hit our fiscal targets. If Ontario does not achieve its targets, the province risks paying more interest on debt instead of investing in what matters most to Ontarians — education, health care and job creation”