Ontario Premier Dalton McGuinty had little time to celebrate the passing of his Liberal budget on Tuesday at Queen’s Park. The following day, Standard and Poor’s put Ontario’s credit rating under “negative credit watch,” reports the Financial Post. This is all but a threat to downgrade the province’s credit rating from the current AA-.
From the Post:
“We believe the province’s main credit challenges include its continuing weak budgetary and debt metrics and its challenging cost-containment plan required to achieve budgetary balance by fiscal 2018,” S&P said in a statement.
Earlier in the day, the province reinforced its commitment to the spending restraint proposed in the 2012 budget, which aims to eliminate the $15.3-billion provincial deficit over the next five years.
Finance Minister Dwight Duncan tried to take the news in as graciously as possible:
“We need to embrace this,” he said. “We need to accept, say that the targets we’ve laid out have to be achieved. Standard & Poor’s has said very clearly what they’re going to be watching for the next two years. And that’s a call to all of us, not only here in the legislature, but all of our bargaining agents and all of the people in Ontario.”
Ducan was referring to the many labour groups currently in negotiations with the government. On Monday and Tuesday, talks with the Ontario Medical Association and the province’s high school teachers broke off, reported the Globe.