02) ONTARIO: A BANKERS' BUDGET FOR THE 1%

Executive Committee, Communist Party of Canada (Ontario)

     While Liberal Premier Kathleen Wynne and the media continue to press the idea that her minority government ‑ under pressure from the NDP ‑ delivered a progressive agenda in the May 2 budget, in fact nothing could be further from the truth.

     This is a bankers' budget, written by and for the 1%. Delivered by former banker and current Finance Minister Charles Sousa, under the direction of former banker Don Drummond, it reprises almost the entire list of recommendations in the Drummond Report, starting with the proposal to slash social spending, continue slashing public sector jobs, and legislate across the broader public sector the wage and benefit cuts imposed on teachers and educational workers in January.

     This includes pension reforms that aim to end the defined benefit pensions still common in the public sector, that have already been ripped out of private sector collective agreements. Further, the government has already signed agreements with the 5 biggest public pension plans banning additional contributions that might be required to maintain current pension benefits for retirees. This would result in pension cuts, most likely to occur in the next deep recession.

     The government will "hold" program spending to 1% for the second year in a row. This is below the rate of inflation, and well below the actual costs of providing healthcare, public and post‑secondary education, and mandated social programs and services to Ontario residents. With per capita program spending already the lowest in Canada, the government will further starve these programs, privatize, contract out, and reduce both the quality and quantity of public services to Ontarians. This is the real, anti‑human face of austerity, and the real face of the Liberal government in Ontario.

     While healthcare spending will increase by 2% to boost languishing homecare and long‑term care services, the increase is offset by bed closures, layoffs, and service reductions in hospitals across the province, and cuts in other non‑healthcare programs and services.

     In education, the story is the same with locally elected School Boards being told to sell off land and schools to offset shortfalls in provincial transfer payments. The province will also send in teams to find more 'efficiencies' in Boards' spending, further undermining local autonomy and democracy. There is nothing about the needs‑based funding formula demanded by School Trustee Kathleen Wynne 15 years ago and promised by the Liberals 10 years ago.

     In post‑secondary education, the 30% tuition freeze will continue to be paid for by cuts to other student aid and grants. An undisclosed "new financial framework for tuition" is announced, but precludes real reductions in tuition, or increases to core funding for universities and colleges.

     For youth, the government will strike a panel to study the minimum wage, and will give employers $295 million to hire 30,000 youth and students.

     For seniors, the government will introduce income testing in 2014 for the Ontario Drug Benefit program that provides all seniors over 65 with some free drugs.

     On social assistance, the government has cherry‑picked the SARC report and eased the rules limiting assets and earned income before clawbacks, while indicating it will focus on reducing caseloads by providing cheap labour to employers across the province. A 1% increase in benefits, which are now the lowest in Canada, will put just $6 a month more into the pocket of a single man or woman living on a benefit of just over $600 a month.

     The $200 increase to the Ontario Child Benefit promised for 2013, has been diluted to cover both 2013 and 2014.

     On transportation, the budget generally favours road tolls, including tolls for access to high occupancy lanes on existing highways, but commits a nominal (but vote getting) $100 million to northern Ontario roads and infrastructure.

     On energy, the budget introduces income testing to reduce eligibility for the Ontario Clean Energy Benefit. This will increase residential electricity bills for most homeowners and tenants by 10% or more.

     On auto insurance, the government has 'met' NDP demands to cut rates by 15%, with the promise to try hard by focusing on insurance fraud. While unhappy with this totally inadequate response, the NDP no longer supports public auto insurance which is the only way to bring down insurance rates and to stop the gross price fixing and profiteering of the transnational insurance companies.

     On cities, the government will continue to upload the costs of services downloaded in the 1990s by Tory governments. A small share of the gas tax is also offered, but no new financial deal to provide the funds so urgently needed to run Ontario's cities and municipalities in the 21st century.

     All of this is being done in the name of deficit reduction, even though the deficit is declining at a rate far faster than expected, mainly due to rock bottom interest rates which are projected to continue for some years yet.

     Nowhere is there any mention of progressive tax reform based on ability to pay, that would increase corporate taxes and the CIT rate, and restore the capital tax, thereby turning on the revenue taps that both the Liberals and Tories have deliberately turned off over the last 30 years. This is a revenue crisis that has been deliberately created, to fuel the myth of a spending crisis and justify the vicious attacks on healthcare, education, social programs and services, and on working people, youth, women, the unemployed, and the poor.

     This austerity budget is proof that the Ontario Liberals are the party of Big Business, the banks and insurance companies, and the wealthy one percent in Ontario, and no friend to working people, youth, women, the unemployed and the poor.

     What Ontario needs is massive job creation, and a substantial rise in wages, incomes and living standards across the board. Public investment in social housing construction, in provincial and municipal infrastructure, in public and post‑secondary education, in healthcare and public services, in a provincial system of quality public childcare ‑ this is the way to a people's recovery.      What we need is legislation to stop runaway plants and employers, and put basic steel and energy under public ownership and democratic control; to build public transit and a Canadian car that's small, fuel‑efficient, and environmentally sustainable, to adopt a value added manufacturing and industrial strategy, and a trade policy that puts people before profits.

     What Ontario needs is progressive tax reform based on ability to pay that will put the load on the corporations and the wealthy 1%, to provide the revenues needed to pay for these policies and programs. We need to curb corporate power, expand public ownership under democratic control, and strengthen labour, civil, social, and democratic rights.

     The Communist Party's 10 point Prescription for a People's Recovery (available at www.communistpartyontario.ca) contains the policies and priorities important to working people, to women, youth, and to social progress in Ontario. Many of them are supported by labour, youth and student organizations, and many other organizations and movements. These are the policies and direction that should be reflected in this provincial budget.

     Regrettably the NDP no longer advocates many of these policies, and has lost the opportunity of a minority government to press forward with them. Their refusal to fight for public auto insurance is a good example of what has been lost. In their drive to rid themselves of socialism, they have rid themselves of policies that are very important to working people. These are policies that challenge corporate power, and the power and greed of the banks and insurance companies in the first place.

     The Tories support the austerity measures in the budget, but will oppose the budget because their far right policies dictate even more vicious attacks on labour and democratic rights, including attacks on the Rand Formula and the closed (union) shop.

     Sensing the public's deep anger at the 10 year old government, the Tories think they can topple the Liberal minority and form a far‑right Tory majority in Ontario. This would be a disaster for democracy and for working people.

     In this political stalemate, labour and the people's movements must seize the initiative and fight for progressive policies and a new progressive direction for Ontario. By fighting for these policies now using mass independent political action, labour and the democratic movements can make these the central issues in the coming election, hobble the far right, and push politics to the left in Ontario.

     The alternative to an all‑out militant struggle against austerity, is more austerity measures ‑ implemented by compulsion or submission until nothing is left of our universal healthcare system, quality public school system, universal social programs, jobs, wages and pensions, labour and civil rights, and democracy. That's what austerity has delivered in Europe ‑ along with a new recession.

     That's what's on the line in Ontario, and what we have to mobilize now to block and defeat, in the struggle for a better future ‑ a better world ‑ where people's needs trump corporate greed all the time.

(The above article is from the May 16-31, 2013, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $30/year, or $15 low income rate; for U.S. readers - $45 US per year; other overseas readers - $45 US or $50 CDN per year. Send to People's Voice, c/o PV Business Manager, 706 Clark Drive, Vancouver, BC, V5L 3J1.)