2016 Ontario Budget Analysis

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2016 Ontario Budget

What We Like, What We Knew, The Work Ahead

Overview of the Budget: Cap-and-trade, Infrastructure, Tuition

Ontario’s 2016 Budget featured three major initiatives: a cap-and-trade program that covers 82 percent of the province’s total greenhouse gas emissions, a new (increased) commitment of billions of dollars in infrastructure spending over the next ten years, and a new single upfront grant for post-secondary students called the Ontario Student Grant, which replaces a variety of grants and tax credit programs, making average tuition essentially free for students from families with less than $50,000 in household income.

The Budget confirmed the rollout of the Ontario Retirement Pension Plan in 2018 (for both large and medium-sized workplaces). There was a small increase to social assistance, pilot projects both for a Basic Income (Guaranteed Annual Income) and for a portable housing benefit (rent supplement), and new investments in programs to end violence against Indigenous women and in hospice care.

Balancing the Budget

The Ontario Government plans to continue its program of spending restraint, holding average program spending growth to less than two percent until 2018-19. The Province continues to implement its Program Review process, which found $500 million in savings through back office efficiencies, asset sales, and similar initiatives this year. The Budget forecasts a 2015-16 deficit of $5.7 billion, down $2.8 billion from the 2015 Budget projection. Tax revenues are projected to grow 4.3 percent in 2016-17 from current levels: $30.3 billion from personal income taxes, $23.5 billion from sales tax, and $11.4 billion from corporations tax. Annual growth from 2014-15 to 2018-19 will average 1.8% in the health sector, 1.2% in education, 2.7% in children’s and social services sector, and 1.2% in the justice sector.

Impact on Our Sector

There were very few surprises in this year’s Budget, due in large part to the flood of announcements from the Ontario government in the past several weeks– including the new cap-and-trade program, an Anti-Racism Directorate, a strategy to end violence against Indigenous women, a Centre for Workforce Innovation, a Social Housing Retrofit fund, and updates to the ORPP, to name just a few. The Budget specifies many infrastructure opportunities where the nonprofit sector could advocate for community benefit agreements (CBAs). However, the onus will remain on our sector to invite ourselves to the table and create our own opportunities. There was also little detail, or new programs or investments announced related to many of the subsectors that make up our vibrant sector.

We’ve broken down our analysis into three key areas: what we like, what we knew, and the work ahead. Of particular concern overall is that the Budget does not reflect the increasing pressures for felt by those delivering services  in communities, or even cost-of-living increases, in many program areas.

Find out what the 2016 Ontario Budget means for your organization.

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As a follow up to our initial reactions to the 2016, we’ll be hosting a Budget Analysis webinar on Wednesday, March 9 to help nonprofit organizations make sense of this 400+ page document.

Join Pedro Barata and Howard Green of the United Way of Toronto and York Region who will join ONN’s policy team for a provincial budget analysis webinar. This webinar will improve your provincial budget literacy… because no one should have to read a Budget document alone!


What We Like:

  • Youth employment – Province is investing $160 million over two years for support and training to young people with multiple barriers to employment
  • Affordable Housing – Province is investing $178 million over three years
    • With $45 million over three years for the Community Homelessness Prevention Initiative (CHPI);
    • And $2.4 million in 2016-17 to pilot a new portable housing benefit offering more options for those leaving domestic violence
    • Development of a housing strategy specific to Indigenous peoples
  • Evaluation of a Basic Income Pilot – to test whether basic income could “build on the success of minimum wage policies and increases in child benefits by providing more consistent and predictable support in the context of today’s dynamic labour market”
  • An end to adoption fees
  • Public mandate letters for every agency of the Province
  • Nonprofits that pay Workplace Safety and Insurance Board (WSIB) premiums will see a reduction in premiums over the next six years. Average premium rates will fall from $2.46 (per $100 of payroll) in 2015-16 to $2.12 by 2022 (in 2015 dollars)

What We Knew:

  • Ontario Retirement Pension Plan (ORPP) – all workplaces with 50 or more employees and no comparable workplace plan will start paying ORPP premiums on January 1, 2018
  • Transfer Payment Administrative Modernization – as ONN has been advocating via our Joint Funding Reform Forum, the Province confirmed that it will introduce a single-window online registration process for nonprofits that receive transfer payments. This “my account” functionality will reduce the time nonprofits spend inputting and verifying basic account information, and will also allow for electronic uploading of documents. Using the Canada Revenue Agency business number for the registration process will lay the groundwork for streamlined risk management and a reduced reporting burden.

“A single registration platform for all non-profits that receive provincial transfer payments will reduce the administration burden and ensure more efficient use of our resources. Simpler and more transparent for all of us!”
– Cathy Taylor, Executive Director, Ontario Nonprofit Network (184)

  • Ontario Trillium Foundation – funding unchanged at $115M for 2016-17

The Work Ahead:

  • A renewed Social Enterprise Strategy – with details still to come
  • Employment and Labour Market Development
    • Implementation of a Labour Market Information (LMI) Strategy  – there are significant needs for LMI in the nonprofit sector to facilitate workforce planning
    • The newly-created Partnership Council on Employment Opportunities for People with Disabilities
    • The Premier’s Highly Skilled Workforce Strategy Expert Panel – final report due fall 2016
    • Continued consultations on the Gender Wage Gap Strategy and the Changing Workplaces Review (interim report due in March)
  • Youth Employment – piloting a Collective Impact (CI) approach to improve outcomes for youth not in employment, education or training
  • Digital Government & Open data – let’s work with government to support the open-by-default approach to help all sectors use data more effectively
  • Anti-Racism Directorate – launched, but no funding announced
  • Surplus school space – $11 billion over ten years in capital funding for schools, including “projects to reduce surplus space through school consolidations” (77) – will this create more community space?
  • Updating the 2010 Long-Term Affordable Housing Strategy, including a framework for a system of portable benefits (rent supplements) and planned legislative and regulatory changes to increase the supply of affordable housing
  • Red Tape Challenge for Ontario businesses – will the government put the same effort into accelerating ‘red tape reduction’ for nonprofits?

We expected more on…

  • Community Hubs: Thousands of hours have been spent on consultations and meetings to help inform the design and implementation of the Province’s community hubs action plan. Nonprofits have been forthcoming about barriers to establishing and sustaining community hubs, including the need for streamlined operating support, access to capital and financing, and a reduced reporting burden for multi-service providers. The Budget announcement of a resource network (with no dollars attached) and ongoing work to look at surplus school properties does not reflect the priority placed on community hubs since the spring 2015 announcement of a Community Hubs strategy. Let’s keep up the momentum to support integrated and responsive community-governed service delivery!
  • Social procurement and community benefit agreements (CBAs): Ontario will invest $160 billion over 12 years (starting in 2014-15) in infrastructure — including major transit projects in Toronto, Hamilton, Peel, and Brampton; post-secondary campuses in Markham and Peel/Halton; and gaming sites in Belleville, northern Ontario, and southwestern Ontario — and yet there were no explicit references to the opportunity presented by the use of Community Benefit Agreements to see more of this investment stay in these communities. Neither was there a commitment to introduce a Social Procurement Strategy that would encourage government procurement from Ontario’s social enterprises, cooperatives, and other nonprofits.
  • Paying the full cost of service delivery: There are clear indications that Budget allocations to support the nonprofits that deliver services on behalf of government are not keeping up with inflation, let alone population growth and increasing community needs, at a time when accountability demands continue to rise. Nonprofits will be looking for government to pay for the full cost of delivering the services they are contracted to provide, including increased staffing costs associated with employer ORPP premiums in future.

Other Budget Highlights Affecting Community-Based Nonprofits (by Subsector)

Arts and Culture

  • The Budget announced $3.3 million for the reconstruction of the Blyth performing arts facility as a cultural hub in southwestern Ontario


  • A cap-and-trade program that is expected to bring in $0.5 billion in 2016-17 and $1.9 billion in 2017-18
  • Fuel tax increases – gasoline 4.3 cents, natural gas 3.3 cents (as a result of cap and trade)
  • $5 million to support climate change adaptation and mitigation activities in First Nation communities. The Province is also investing $8 million for microgrids in remote First Nation communities to replace the use of diesel fuel with alternatives
  • As part of the Province’s climate change strategy, the government is dedicating $100 million of its $325 million Green Investment Fund to help about 37,000 homeowners conduct audits to reduce their energy bills by identifying energy saving opportunities and retrofits
  • A $17 million endowment to support the Toronto Atmospheric Fund


  • Home and community care – a funding increase of $250 million per year for the next two years
  • A second-year announcement for the 10-year Mental Health & Addictions dedicating $4 million for 248 units in 2016-17
  • $2 million for 10 Indigenous organizations to engage communities and make recommendations on a mental health and addictions strategy for Indigenous people

Social Services

  • Social assistance – a modest 1.5% in rates for Ontario Works and the Ontario Disability Support Program, with a slightly higher total increase of $25 a month going to single individuals on Ontario Works who have no children (the group receiving the lowest rates)
  • Changes to child support payments so people who receive social assistance and support payments “can benefit from more of this income” (131)

Note: the Legislature’s independent Financial Accountability Office has released its assessment of the 2016 Budget.

What did your organization think about the 2016 Ontario Budget?

Share your thoughts with us! Email: kate@theonn.ca