Ontario's minority Liberal government will table its first budget March 27, and has already warned of deep spending cuts to trim the $16 billion deficit.
The Liberals have a fine line to walk to protect gains in health care and education while finding enough savings to eliminate the deficit in five years, or face an expensive credit downgrade.
They also have to make sure the budget contains measures that at least two opposition party members will vote for, or Ontario will be plunged into its second election campaign in five months.
The government is expected to seek support for the budget from the New Democrats, who want the Liberals to delay a planned cut in the corporate tax rate.
The Progressive Conservatives want a job-creation plan, and doubt the Liberals will make the tough decisions necessary to get Ontario back in the black.
Economist Don Drummond recommended hundreds of cuts to programs and services, so the government could limit its overall spending increase to just 0.8 per cent a year for five years.
The Liberals rejected Drummond's call to eliminate all-day kindergarten, which will cost $1.5 billion a year, but said virtually all of his other recommendations are on the table.
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