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Ontario Needs To Be Honest To Improve Its Transit Infrastructure

Did you know interest payments on debt are already the third highest expenditure in Ontario's budget? Interest payments cost more than the entire budgets for transportation, college and universities, children and youth services, even slightly more than social services. Only health care and education have higher budgets than interest payments on debt.
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Parliamentary building in Queen's Park, Ontario, Toronto, Canada
Klaus Lang via Getty Images
Parliamentary building in Queen's Park, Ontario, Toronto, Canada

Ontario, we need to talk.

Let's have an honest conversation how we're going to pay for the kind of province we want. My guess is that like me, you support paying for public services and infrastructure -- things we need like transit and roads.

The problem is that our political parties -- at least the status quo ones -- aren't willing to have an honest conversation about how we pay for these projects.

But if we don't have an honest conversation about costs and funding, I'm afraid interest payments on debt will crowd out spending on essential government services.

Did you know interest payments on debt are already the third highest expenditure in Ontario's budget? Interest payments cost more than the entire budgets for transportation, college and universities, children and youth services, even slightly more than social services. Only health care and education have higher budgets than interest payments on debt.

I think more of your tax dollars should go to paying for public services we rely on everyday -- education, health care, transit, roads, clean water. But if we are going to lower the amount we spend on interest, we need to be honest about paying for what we need.

The Liberal government has a plan to spend $160-billion over the next 12 years on infrastructure and public transit projects. This is the biggest reason our net debt will keep growing, according to Ontario's Financial Accountability Office.

I believe these plans are important -- we desperately need better transit to reduce gridlock.

But the Liberals are paying for this by going deeper into debt and liquidating a profitable public asset in Hydro One.

In the next four years, we're going to be adding about $50 billion to our debt for a total net debt of $350 billion. That's an additional $3,700 per person on top of the $20,806 each Ontarian (that's you and me!) owe in government debt.

These much needed investments could have been made without increasing our debt or selling off valuable assets. So why weren't they?

Instead of following the advice of numerous experts that the government hired themselves, Queen's Park politicians of all colours played political games about how they would pay for transportation infrastructure.

In the spring of 2014, the NDP threatened to bring down the minority Liberal government if they introduced new funding tools or taxes for transit.

The Conservatives pretended that billions could be found by cutting "waste." The Liberals capitulated by saying they would fund their transit plans with a vague promise to "optimize" public assets.

We essentially had a provincial election campaign where the three parties with seats at Queen's Park promised to fund transit and transportation infrastructure with fairy dust and magic money.

The Liberal's magic money tree turned out to be your child's credit card. "Optimizing" assets turned out to be selling off Hydro One. This sale helps the Liberal's paper over their deficit in time for the next election, while losing us money over the long-term.

The lack of honesty at Queen's Park is turning out to be a financial disaster for Ontario.

We, the people of Ontario, are left holding the bag -- or more accurately punting it down the road to our kids.

Today's low interest rate environment makes Ontario's sky high debt manageable. But a one percent increase in interest rates would result in an additional $350 million in annual interest payments. That $350 million is more than the entire budgets for the Ministry of Labour, Indigenous Relations and Reconciliation, Energy, among others.

So what's the answer? It's not austerity. Infrastructure won't be built with fairy dust and magic money. And it's irresponsible to charge it all to our kids. At the GPO, we support parking levies, congestion charges and land value taxes to pay for transit and transportation infrastructure.

The revenue tools we support -- and experts recommend -- not only raise the money needed to build transportation infrastructure, they also have the added benefit of creating market incentives to reduce gridlock right now.

Honesty matters -- or it should. We need more of it at Queen's Park.

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