As Liberal Premier Dalton McGuinty unveals the provincial budget today, public sector workers face major adjustments, reports the Globe and Mail: “Public-sector employees in Ontario will have to make higher contributions to their pension plans, have their benefits cut or work longer before they can collect retirement pay.”
Ontario is expected to post a budget deficit of $16 billion this year.
Globe columnist Adam Radwanski reminds us of what’s at stake. Ontario is facing a downgrade and possibly an economic disaster unless McGuinty and Finance Minister Dwight Duncan propose a sensible plan to reduce the deficit:
A credit downgrade, threatened by Moody’s Investors Services at the end of 2011, would likely cause borrowing costs to go up. If so, that would force some combination of program cuts and tax increases beyond what any provincial party wants to consider. At the same time, a loss of confidence in the government’s ability to keep its head above water could impede Ontario’s already fragile economic growth. Amid ensuing fears about the province’s long-term ability to maintain its infrastructure, its core programs and its competitive tax regime, skittish investors would be more inclined to take their business elsewhere.
There is little question the budget will bear uncomfortable news for everyone in the province. Quoted by the Toronto Star, Duncan has said of the budget: “We are taking a balanced approach. We will be asking everyone to do their share.”