The FAO produces regular reports analyzing the state of the Province's finances, trends in the provincial economy and estimates of the financial impact of bills or other proposals over which the Legislature has jurisdiction.
This report provides an updated assessment of the Province’s health sector expense plan, and compares Ontario’s planned health spending to the growth in Ontario’s key drivers of health care costs.
This report provides an updated estimate of the fiscal impact of the partial sale of Hydro One and reviews key considerations surrounding the sale, such as the potential effect on electricity ratepayers in Ontario.
This report provides an updated Economic and Fiscal Outlook for Ontario based on developments since the release of the FAO’s spring outlook on May 31, 2017.
Ontario posted a strong job gain of 128,400 net new jobs in 2017, as the unemployment rate declined to 6.0 per cent. Looking behind the strong headline results reveals a changing labour market with both improvements for some workers, as well as continuing challenges for others.
In 2016, the average Ontario household owed nearly $154,000, representing 171 per cent of household disposable income. As interest rates increase, the share of household income spent on debt payments is expected to rise from 13.9 per cent in 2016 to 15.3 per cent by 2021. For the average household, the FAO expects annual debt payments to increase by $3,000 to $15,500 by 2021.
As part of the Fair Workplaces, Better Jobs Act, the government proposes to raise Ontario’s general minimum wage from its current rate of $11.40 per hour to $14 per hour on January 1, 2018 and $15 per hour the following year. While almost 1.6 million workers will benefit from the increase, a significant number of lower wage workers will lose their jobs and some businesses will struggle to cover higher payroll costs.
FAO backgrounders provide primarily descriptive information on issues of interest to Members of Provincial Parliament. Backgrounders are based on information that the FAO has received from the Province.
This backgrounder includes a list of 2017-18 service fee rate changes, a discussion of the growth rate of service fee revenue, and a review of the cost recovery ratios for a selection of service fee categories.
Ontario’s debt is rated by four principal international credit rating agencies, which typically publish an annual update of their view of the province’s finances and the quality of Ontario’s debt.
Following the tabling of Ontario’s 2016 Budget, each of the four rating agencies affirmed their current rating of Ontario’s debt, indicating that they believe the province has taken adequate steps on both revenues and expenditures to achieve its plan to restore fiscal balance by 2017-18.
However, if Ontario’s fiscal position deteriorates beyond 2017-18, either through an easing of expenditure restraint or unexpected revenue weakness, the agencies could be expected to lower Ontario’s credit rating, which could lead to higher borrowing costs and a more challenging fiscal position.
The Province forecasts that it will collect $2.74 billion in service fee revenue in 2016-17. This backgrounder provides a partial list of changes to Provincial service fee rates planned for 2016-17 and includes a discussion of the growth rate of service fee revenue. Service fee revenue has increased by an average of 6.8% a year since 2011-12, largely due to the increase in revenue from vehicle and driver registration fees.