“We need the CCPA to remind us that our dreams of a decent, egalitarian society are reasonable — indeed that with a little work, they are practical. And I love that practicality, that protection of the dream of the possible.”
— Naomi Klein
Projects & Initiatives: Ontario Alternative Budget
May 7, 2001
In its annual pre-budget analysis, the Ontario Alternative Budget Working Group has a simple message for the Harris Government: "Park the ideology and call off the dogs. Put the corporate tax cuts on hold. And put a stop to the attacks on education, health care, public infrastructure and the homeless."
The Pre-Budget Analysis makes it clear that the Harris Government has a choice. It can postpone its program of corporate income tax commercial and industrial property tax cuts, and manage its way through the economic slowdown to protect what remains of Ontario's vital public services. Or it can stick to its ideological guns, and wreak further havoc on our schools and hospitals,
The "financial crisis" that forms the theme of every speech of the Premier and the Minister of Finance these days is a manufactured crisis. It is a crisis that was created by the Government's fiscal mismanagement. And it is a crisis that would go away if the tax cuts were suspended.
The Analysis reveals that:
- By fiscal year 2000-1, the Mike Harris personal income tax cuts were reducing revenue by $9.5 billion a year, while corporate and other tax cuts reduced revenue by a further $2.2 billion a year.
While the Analysis shows that the Harris Government could easily avoid the services blood-letting to which it seems to be committed, it also identifies in other areas of the budget the likely impacts of sticking with the tax cut schedule:
A base-line surplus (no tax cuts, spending increase at rate of inflation, normal reserve allowances) -- (+$0.5 billion)
- Implementation of previously announced tax - (-$1.5 billion)
- New tax cuts - (-$1.0 billion)
- Budget freeze except for health and education; lower-than-inflation increases for health and education -- (+1.0 billion).
- Reduced reserve allocations -- (+$0.25 to 0.5 billion)
- Increased education property taxes -- (+0.1 to 0.25 billion)
- Reduced capital spending -- (+$0.25 to $0.5 billion)
- Asset sales - (+$0.1 to $0.25 billion)
The Pre-Budget Analysis is the fourth in a series of pre-budget papers released by the Ontario Alternative Budget Working Group in 2001.
The others in the series are: OAB Technical Paper #10 - Fiscal Options; OAB Technical Paper #11 - Health Care Funding; OAB Technical Paper #12 - Housing.
The Ontario Alternative Budget will be available the day after the official budget day, together with an analysis of the official budget. The release is scheduled for the Queen's Park media studio at 11:00 a.m. Thursday May 10, 2001.