The province’s ‘line-by-line audit’ finds what any Tory — or Liberal — government would

OPINION: A hasty examination of Ontario’s finances is complete, and none of its recommendations is shocking, writes John Michael McGrath — no matter what the opposition parties tell you
By John Michael McGrath - Published on September 27, 2018
Treasury Board president Peter Bethlenfalvy denied Wednesday that the provincial government is preparing to privatize the LCBO. (Christopher Katsarov/CP)



Armageddon is a place — an ancient city whose remains lie in modern-day Israel. It’s been fought over since at least 1500 BCE, when Egyptian pharaoh Thutmose III led his armies through it. In 1918, British Army general Edmund Allenby won a major battle against the Ottomans there in the waning days of the First World War, leading his army on the same path Thutmose did. Whether he knew about the Egyptian campaign of 3,500 years earlier is a matter of some dispute, but the fact is that there are only so many ways to move armies through the same terrain, whether they’re fighting with spears or artillery shells.

If this sounds like an odd metaphor for Ontario’s public finances, well, it is — but the recommendations released yesterday as part of a “line-by-line audit” of the government’s books remind us that, no matter who’s in charge, there are only so many ways of solving the same problem. The Ernst & Young report would’ve turned out largely the same had it been commissioned by any Tory government (or even Liberal government) looking to restrain public spending.

When it comes to Ontario’s public finances, after all, the big picture hasn’t changed since well before the election. The vast majority of spending is in health care and education; most of the growth in spending is in what’s called the “broader public sector” — schools, hospitals, universities, and anyone who relies on provincial tax dollars but doesn’t work directly for a minister (including, full disclosure, TVO employees). And in the broader public sector, the majority of spending is on salaries.

So far, so banal: the $95,000 report contains the stunning revelation that a provincial government that’s serious about cost-cutting will have to address … education and health-care spending — and that in order to do so, it may have to take a firmer stance on labour relations than the last government did. Who could have predicted that? Anyone with a passing knowledge of the province and its budget.

Which isn’t to say that the report doesn’t include some interesting bits. The most headline-grabbing conclusion is that the provincial government could consider “monetizing assets through divestiture,” which is consultant-speak for privatization. Many — including the New Democrats — see this as a sign that the government is preparing to privatize the LCBO, something Treasury Board president Peter Bethlenfalvy denied Wednesday.

It’s amusing, given the context, that the report cites the Liberals’ sale of the LCBO’s Toronto waterfront HQ as an example of sensible “asset recycling” — a term that first made its way into Ontario’s public-policy vocabulary in conjunction with the Wynne government’s promise to put the proceeds from the privatization of Hydro One toward new infrastructure. The opposition parties may balk at more privatization, but it’s hardly a lightning bolt out of the blue, policy-wise.

You’ll find more of the same throughout the report if you go looking for it. One section says that Ontario needs more federal funding, especially for its growing health-care spending. The source of E&Y’s data? The Mowat Centre, a U of T think-tank created by the Liberals to focus on provincial policy. Kathleen Wynne used the same basic data to hammer away at the Harper government prior to 2015. Doug Ford and the Progressive Conservatives are effectively endorsing an argument once used to criticize their federal cousins.

The report was completed quickly — and it’s true that when time is short, you sometimes have to rely on other people’s work. But it’s also true that there aren’t a whole lot of new solutions out there for Ontario’s policy problems, especially if you’re going to rely on the same types of consultants for advice that the last government did. The E&Y report doesn’t break any new ground, doesn’t tell us anything about the government’s finances that we didn’t already know, and doesn’t present any solutions that the Tories (or Liberals) wouldn’t have already heard about by now.

Doug Ford has already changed a lot in Ontario politics, but some facts are stubborn. Just as there are only so many ways to march an army over the same terrain, there are only so many ways to shrink provincial spending on the billion-dollar scale the Tories are looking at.

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