Ontario Finance Minister Peter Bethlenfalvy tabled a record $214.5-billion budget for 2024-25 on Tuesday, which includes a $9.8-billion deficit.
The Ministry of Finance pointed to slowing economic growth projections leading to lower tax revenues, along with high interest rates, as some of the reasons for the larger-than-expected deficit.
Last March, Bethlenfalvy projected this year's budget would have a $200-million surplus.
"One choice would be to put the burden on taxpayers, to raise taxes, tolls, tuition or fees. Well, we are not going to do that," said Bethlenfalvy. "A second choice would be to tighten our belts. To cut investment in housing, roads, or better public services. In short, to retreat, and do less. We are not doing that, either. Instead, here’s our choice: We are going to follow through on a plan that is working, knowing that the higher deficits, compared to what we projected last year, will be time-limited while the return on investment will be felt for decades."
The province is projecting $205.7 billion in revenue and $214.5 billion in spending in the coming fiscal year.
Another factor driving spending is the over $6 billion owed to public sector workers after the Conservatives' wage-cap legislation was found to be unconstitutional.
The extension of the gas cut, announced earlier this week, will cost the province over half a billion dollars more.
It's the highest non-COVID deficit since former premier Kathleen Wynne's 2014 budget.
In 2025-26, Bethlenfalvy is forecasting a $4.6-billion deficit. The projection does show a $500-million surplus in 2026-27, just in time for the next election.
The 2024-25 budget includes investments designed to increase housing, including $1 billion for the new Municipal Housing Infrastructure Program. There will also $825 million directed toward the Housing-Enabling Water Systems Fund to help municipalities improve critical infrastructure needed to reach housing targets.
When it comes to health care, the Ontario government is investing $546 million over three years to connect approximately 600,000 people to primary health care teams. They're also giving $9 million in start-up funding for a new School of Medicine at York University.
However critics point to base spending on health care, which will only increase from $74.6 billion last year to $75.6 billion, a below-inflation jump of just 1.3 per cent.
Ontario NDP Leader Marit Stiles said the budget won't meet the needs of the public, and is filled with reannouncements from previous years and budgets.
"For everyone in Ontario who is looking for change, this budget isn’t for you," said Stiles. "This was an opportunity to deliver better health care and more affordable housing. The government chose to stick to the status quo that has been failing Ontarians."
Liberal Leader Bonnie Crombie called it a "do-nothing" budget that "wasn't worth the paper it was printed on."
"Doug Ford has no intention of making life better for Ontario families and businesses," she said. "He is choosing to undercut our public institutions so that he can further his privatization agenda and his rich insider friends make more money."