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Statement by Finance Minister Charles Sousa on Provincial Negotiations with the City of Toronto

Archived Statement

Statement by Finance Minister Charles Sousa on Provincial Negotiations with the City of Toronto

Ministry of Finance

Charles Sousa, Minister of Finance, released the following statement regarding ongoing negotiations with the City of Toronto around provincial assistance to the city: 

"The City of Toronto recently came to the province with a request for financial assistance. After several weeks of negotiations, the city has rejected Ontario's offer.

The province has worked diligently with the City of Toronto on an option for financial assistance which would have provided the City support in a way that did not have a fiscal impact on the province. We understand the City has decided to seek financing through other means. We respect that decision and look forward to working with the City as well as other municipalities in the future.

Provincial ongoing support to the city has increased significantly in recent years through investments that include: 

  • Fully transferring the costs of the Ontario Drug Benefit Program and the Ontario Disability Support Program from the city to the province. In 2015, the province will continue to phase in the upload of Ontario Works benefits and court security costs from the city to the province. In 2015, the total benefit provincial uploads for Toronto is estimated at over $460 million or 12 per cent of the city's property tax revenues.
  • Revenue from the provincial gas tax program and the province's increased share of public health and land ambulance funding, estimated at almost $300 million in 2015.

Given this increased support, in 2013 the province announced that it would phase out Toronto Pooling Compensation over three years, beginning in 2014. This special provincial assistance to the city was initially designed to deal with past pressures from social benefit program costs now covered by the province. As additional support, the province forgave an outstanding loan owed to the province, the Toronto Debenture Loan, which provides significant financial benefit to the city worth more than $230 million by 2016.

The province is not reversing its decision on Toronto Pooling Compensation. Through the upload of social assistance benefit program costs to the province, the province has directly addressed the issue that pooling was designed to respond to - the pressure that those costs imposed on the city's property tax base.

In 2013, the city achieved a budget surplus of $168 million and forecasts a budget surplus of approximately $100 million for 2014.

The province must make fiscally-responsible decisions as we implement our plan and work to balance our own budget by 2017-18.

While we recognize the unique challenges of Ontario's largest city, any support must be consistent with Ontario's fiscal plan. We will continue to build on our strong partnership with the city and make progress in areas of shared provincial-city interest, such as transit."

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