Ontario Debt Backgrounder

OTTAWA, ON: Premier Dalton McGuinty’s record of running big deficits will come under the spotlight this month as The Canadian Taxpayers Federation (CTF) Ontario Debt Clock tours the province.

The giant clock, the size of a scoreboard, tallies the growth in the province’s total debt load, rising at the rate of $685 a second. Each day, Ontario’s indebtedness rises by $59 million, with the total debt expected to hit $257.9 billion by the end of the current fiscal year.

“The McGuinty government has added $110 billion to Ontario’s provincial debt since taking office,” said Gregory Thomas, Federal and Ontario Director of the CTF. “If the Premier remains in office, he is on track to double Ontario’s debt by December 10^th, 2012.”

Thomas says the massive provincial debt load is exacting a steep toll on Ontario families, in the form of $10.3 billion in annual interest payments.

“We’re paying $28.2 million a day in interest. If we didn’t have these debt payments, we could cut income taxes by 44 per cent, or cut the provincial portion of the HST from 8 per cent to 4 per cent.”

In the 2009-2010 budget year, interest payments on the provincial debt consumed the equivalent of 89 per cent of health transfer payments from the government of Canada, or 43 per cent of the provincial education budget. The province spent more on interest payments than it spent on its entire budget for training, collesges, and universities.

As opposition leader, Dalton McGuinty promised the Canadian Taxpayers Federation in a written pledge on September 11, 2003 that he would not raise taxes without the explicit consent of Ontario voters and that he would not run deficits. The commitment generated considerable media attention, factoring heavily in McGuinty’s ensuing election victory.