Ontario’s deficit for the 2024-25 fiscal year has reduced by $3.3 billion, with the province forecasting a balanced budget by 2026, according to Finance Minister Peter Bethlenfalvy. The announcement came during the release of Ontario’s fall economic statement, “Building Ontario For You.”
The provincial deficit now stands at $6.6 billion, a notable reduction from the projected $9.8 billion deficit outlined earlier this year. Minister Bethlenfalvy attributed the improvement to “unexpected tax revenues fueled by inflation and economic growth.”
Key measures outlined in the economic update include a one-time $200 cheque for each taxpayer in Ontario, aimed at offsetting living costs. The program, expected to begin in early 2025, will be funded through increased tax revenue but will cost the province around $3 billion. Additional cost-of-living initiatives include extending the gas and fuel tax cuts through June 2025, which have saved households an average of $380 since implementation in 2022.
The province’s total spending is now expected to reach $218.3 billion, up from $214.5 billion. Ontario’s real GDP growth forecast for 2024 has been revised to 0.9%, with expected growth strengthening to 2.3% by 2026.
The update also highlighted the Ontario Fertility Program expansion, allocating an extra $150 million over two years to triple the number of government-funded IVF treatments available.
Response from Opposition Parties
Opposition Leader Marit Stiles criticized the update, calling the government’s fiscal management a “magic show” of conservative estimates followed by beatable forecasts. Ontario Liberal Leader Bonnie Crombie echoed these sentiments, arguing that surplus funds could be better allocated to hire essential workers such as nurses and teachers.
The update notes challenges in the housing market, revising forecasts for housing starts downward, with 81,300 new homes expected this year, down from the budgeted 87,900. Stiles voiced concern over the province’s housing shortfall given Ontario’s goal of 1.5 million homes by 2031.
Despite opposition criticism, Bethlenfalvy insisted the statement reflects “a realistic outlook” based on Ontario’s current economic landscape and emphasizes the government’s commitment to fiscal responsibility.