On Tuesday, November 14, Ontario's Minister of Finance, Charles Sousa, delivered the government's Fall Economic Statement. Read an analysis below by Counsel Public Affairs.
Ontario government targets seniors and small business in Fall Economic Statement
November 14, 2017
With less than seven months until Election Day, Kathleen Wynne's Liberals are working to make sure no vote is left un-courted.
After spending significant time and political capital helping the younger end of the age spectrum with OHIP+ pharmacare for youth under 25, and providing free tuition for low-income students, the Liberals know it's imperative to go where the votes are.
That's why Finance Minister Charles Sousa today delivered a Fall Economic Statement aimed at reaching two other key voting demographics: seniors and small business owners.
Seniors make up the largest portion of the voting population, and have regularly proven a bellwether for which way an election will swing. Small businesses, who employ more than one-third of Ontario's work force, are anticipating the sting of the planned increases to the minimum wage and were looking for signs of relief.
Small Business Tax Cuts and Offset Package
Hearing the cries of "too much, too soon" from the business community on the increase to a $15 minimum wage, the Liberals have taken action to see if they can mitigate some of the blowback.
While the Liberals recognized the need to provide relief to businesses, Sousa showed no signs of backing down on the timetable for a $15 minimum wage.
The big news from this statement is that corporate tax rates for small businesses will fall to 3.5 per cent from 4.5 per cent on their first $500,000 of income on January 1st- the same day minimum wage will rise to $14 from the current $11.60. That's $5,000 less in taxes per year for a company hitting the half-million dollar revenue threshold.
These cuts, as well as an additional package of offsets, totals $500 million over three years. That will include $124 million for hiring and retaining young workers, $60 million to support produce farmers, and $40 million to help main street businesses modernize and digitize.
Critics will likely say this is not enough to make business whole, but that's never been the point - Liberals are counting on the broad public support for the increased minimum wage to buoy them in the election.
This is mostly a re-announcement of the seniors' strategy released last week - but it bears repeating, as this is not likely the Liberal government's last appeal to this demographic before the next election.
Liberals are responding to the near-constant calls from communities and the opposition for more long-term care options with their plan to create 5,000 new long-term care spots by 2022, and 30,000 new spots over the next 10 years. The plan also includes redeveloping 30,000 existing beds by 2025.
The government will also be increasing their adult vaccine funding by providing a free high-dose flu vaccine that's more effective for older people.
There are some innovative measures that may play well on the ground if they're well-communicated, such as funding for "naturally occurring retirement communities", where funding will provide wrap-around services for seniors where they live to support healthy aging in place. The government is also funding 40 new Seniors Active Living Centres, and expanding their Seniors Community Grant Program.
A Balanced Budget
Ontario is reporting that its budget will remain in the black for the next two years. Whether the Auditor General will agree is another story, though the government has won that dispute based on the action of most media and financial commentators.
All eyes are now turned to the 2018 Budget, widely anticipated to arrive early enough (the end of March, most likely) to provide some runway as a platform for the June election. The Liberals are getting down to brass tacks.
You can read the speech and the complete update at: https://www.fin.gov.on.ca/en/budget/fallstatement/2017/index.html