Ontario legislature fall 2019 in review

Tracking changes – and opportunities – for Ontario’s nonprofit sector

The Ontario legislature’s fall session resumed October 28 for a six-week sitting after a busy spring session and a subsequent five-month break. The Legislature has now risen for the winter break, scheduled to return on February 18 (though committees will meet before then).

ONN has got the nonprofit sector’s back with our analysis of what happened this session in the Ontario Legislature. Here’s the Ontario government’s summary. Read on for what could affect your sector:

Bill 124, Protecting a Sustainable Public Sector for Future Generations Act, 2019

Bill 124, an act to restrain wages, has received Royal Assent, enabling a mechanism for the Ontario government to set retroactive wage controls on the broader public sector. Nonprofits that received $1 million or more in 2018 from the Province are also subject to the legislation.

ONN wrote to the government this spring and again when Bill 124 was at the Standing Committee stage. ONN’s main recommendation was that the Ontario government manage any budget restrictions via overall funding envelopes, rather than through wage controls, as such controls negatively affect the ability of nonprofits to recruit and retain key staff. That way, provincially funded nonprofits could compete for talent on an even playing field with for-profits in areas such as home care, child care, and employment and training. It should be noted that the for-profit sector was explicitly exempted from this legislation.

The salaries of nonprofit workers are on average $42,500, or 29 per cent lower than the average for the Canadian workforce. As per the legislation, affected nonprofit workers will be subject to maximum wage gains of 1 per cent annually — a level that is approximately half the inflationary increase required to maintain an income level in relation to the cost of living. Unfortunately, ONN’s concerns were not addressed in the final version of the Bill.

Bill 138, Plan to Build Ontario Together Act

Bill 138 is an omnibus bill (with 40 schedules affecting 65 laws) that accompanied the 2019 Fall Economic Statement.

In our analysis of the Statement, we noted the centrepiece measures in Bill 138. As anticipated, a number of Budget 2019 measures were rolled back or delayed, including changes to municipal child care, public health, and the autism program.

A comparison: The last five years of Fall Economic Statements

Last fall, ONN looked at the “interim appropriations” in Bill 57, accompanying the 2018 Fall Economic Statement. This was the first indication of the spending plans of this new government.

We have now compared five years of data on what the Ontario government expected to spend on public service operations in its Fall Statements (this does not include capital investments nor operating the Legislature, but everything else). Keep in mind these Statements were under two different governments.

Here is an updated look at the fall appropriations, using the figures from Schedule 20 in Bill 138:

Fall Statement/Budget Measures Bill Planned expenses (operational) for the following year % change from previous year
(not adjusted for inflation)
Fall Statement 2015 (Bill 144), Schedule 11 - Interim Appropriation for 2016-2017 Act, 2015 $124,599,315,700
Fall Statement 2016 (Bill 70), Schedule 11 -
Interim Appropriation for 2017-2018 Act, 2016
$129,260,108,400 +4%
Fall Statement 2017 (Bill 177), Schedule 22 - Interim Appropriation for 2018-2019 Act, 2017 $138,769,721,600 +7%
Fall Statement 2018 (Bill 57), Schedule 22 -
Interim Appropriation for 2019-2020 Act, 2018
$110,800,000,000 - 20%
Fall Statement 2019 (Bill 138), Schedule 20 - Interim Appropriation for 2020-2021 act, 2019 $140,161,500,300 +26.5%
(+1% from Fall 2017)

 

These numbers suggest that the government has significantly changed course between one fall economic statement to the next. Indeed, Schedule 36 of Bill 138 shows that the government had to ask the Legislature for $29 billion in appropriations (spending) for public spending above and beyond what it anticipated when planning for fiscal year 2019-20 last fall.

This change is a testimony to the advocacy efforts of nonprofits, parents, workers, municipalities, and others who made the case for maintaining program spending that is essential to the well-being of their communities.

What else is in Bill 138 that nonprofits should be aware of?

  • Schedule 5 amends the Child, Youth and Family Services Act, 2017 regarding provisions for police officers transporting children.
  • Schedule 8 updates the Co-operative Corporations Act and is good news for the co-operative sector, eliminating the “50% rule” (requiring co-ops to do 50 per cent of their business with members) and bringing co-operators under the auspices of the Ministry of Government and Consumer Services (where nonprofits and for-profit corporations are already managed). Updates to audit rules will reduce administrative burdens on community-owned co-operatives and allow their income to fund increased services.
  • Schedule 15 amends the Health Insurance Act, while Schedule 19 amends the Independent Health Facilities Act.
  • Schedule 29 amends the Pension Benefits Act in a number of ways, affecting transfers from one plan to another. This includes enabling an employer that has a single employer pension plan – with both defined contribution benefits and defined benefits – to transfer assets to a jointly-sponsored pension plan.
  • Schedule 30 amends the Personal Health Information Protection Act to tighten up privacy provisions around health information.
  • Schedule 31 includes follow-up amendments to Bill 108 changes to the Planning Act in ways that affect “section 37” community benefits: This schedule creates a new process for enacting and giving notice of municipal by-laws regarding community benefits charges and any related appeals to the Local Planning Appeal Tribunal.
  • Schedule 37 enacts the Supply Chain Management Act (Government, Broader Public Sector and Health Sector Entities), a “Smart Initiative” announced on October 23 intended for the government to “use our collective public sector buying power to deliver projected savings of $1 billion annually, while also adopting leading supply chain processes and practices.”
    • The provisions apply to the Ontario government, the broader public sector (schools, hospitals, municipalities, etc.) and certain provincially-funded nonprofits, including children’s aid societies, the community health sector, and others as prescribed by regulation (“any other persons or entities” may be prescribed — a very broad definition). The bill includes not only procurement provisions, but also the disposal of surplus assets and a range of other functions related to the procurement of goods and services.
    • The bill enables the Ontario government to direct one entity (from the designated entities listed above) to provide or support supply chain management on behalf of any other in that list. Fees for this service may be set by the supply chain manager, subject to the Minister’s approval. The Ontario government may also, by regulation, create one or more new nonprofit(s) to perform this function. The level of detail set out in the “Corporate and financial matters” schedule suggests that this is imminent.
    • Participation in this initiative is deemed to be a requirement of existing funding agreements.
    • ONN will be following developments under this initiative in order to identify opportunities for social procurement and keeping public lands in community hands.

Note that not all of these schedules came into force on the day that Bill 138 received Royal Assent (December 10, 2019). Please see the individual schedules for their respective effective dates.

Bill 132, Better for People, Smarter for Business Act

Bill 132, the latest red-tape reduction legislation, was introduced by the Associate Minister of Small Business and Red Tape Reduction on October 28. Another piece of omnibus legislation, it contains 17 schedules affecting 79 acts. Hearings on the bill were held in November before it was fast-tracked to Third Reading in December. It passed and received Royal Assent on December 10, 2019.

Here are the pieces of Bill 132 nonprofits should be aware of:

  • Schedule 3, the Local Planning Appeal Support Centre Repeal Act, 2019, dissolves the Local Planning Appeal Support Centre and repeals the Local Planning Appeal Support Centre Act, 2017. This schedule gets points for clarity and concision, but the Support Centre will be missed, as it was set up as a service to assist citizens by providing input to the Local Planning Appeal Tribunal.
    • The end of the Support Centres was the focus of a presentation to the Standing Committee by the Urban League of London.
  • Schedule 4 amends a wide range of legislation relating to agriculture, fishing, and food safety, including amendments to governing legislation for agricultural associations, agricultural societies and horticultural societies.
  • Schedule 7 repeals the Partnerships for Jobs and Growth Act, 2014, which was enabling legislation for the development of regional economic clusters.
  • Schedule 8 amends the Mining Act and repeals Part II of the Northern Services Boards Act, which currently provides for the establishment of area services boards that deliver basic community services in municipally unincorporated areas of Northern Ontario.
  • Schedule 9 amends a number of laws relating to environmental protection, including changes to the administrative penalties levied for violations. Amendments affect the Environmental Protection Act (EPA), as well as laws concerning water use, cosmetic pesticide use, the circular economy, and waste diversion.
    • Administrative penalties are to be paid into the Ontario Community Environment Fund, a $250,000 fund available for (as per the EPA section 182.2) environmental compensation and remediation projects. The fund will now explicitly include activities related to environmental protection, conservation, and awareness-raising.
    • Critics of changes to the Pesticides Act include Ontario Nature, Canadian Association of Physicians for the Environment, David Suzuki Foundation, Environmental Defence, Evidence for Democracy, Friends of the Earth Canada, Ontario Beekeepers Association, and the Registered Nurses Association of Ontario.
    • Environmental Defence also notes that the bill reduces financial penalties for companies that violate the EPA and the Ontario Water Resources Act.
  • It wouldn’t be an omnibus bill without changes to the Pension Benefits Act (no exaggeration: it has been amended 60 times since 2002). In addition to amending the Insurance Act (with respect to insurers and adjusters), Schedule 10 amends the Pension Benefits Act to update the communication requirements for pension plan administrators, the requirements for who may act as a plan administrator for a single employer jointly sponsored pension plan, the requirements for locating a former plan member, the transfer of pension assets from a single employer pension plan to a jointly sponsored pension plan, and the treatment under family law of pension assets that have been transferred from one plan to another.
  • Schedule 14 amends the Occupational Health and Safety Act to eliminate the requirement (s. 34) to notify the Ministry of Labour, Training, and Skills Development before starting to manufacture, distribute, or supply a new biological or chemical agent outside of a research & development context.
  • Schedule 15 removes the requirement for the Minister of Municipal Affairs and Housing to initiate a review of the energy and water conservation provisions of the Building Code every five years; it also dissolves the Building Code Conservation Advisory Council.
  • Schedule 16 amends a number of acts related to conservation and natural resources, including for aggregate quarry development and forests on Crown lands. It also releases the Ontario Government from the Public Lands Act requirement to transmit to the Municipal Property Assessment Corporation (MPAC) annually the list of public lands sold or leased to the private sector. Instead, the bill enables the Minister to transmit a list on a schedule determined by the Minister and MPAC.
  • Schedule 17 simplifies billing for Highway 407 tolls and moves motor vehicle emissions from the Environmental Protection Act to the Highway Traffic Act.

A coalition of 39 environmental and conservation groups issued a letter with eight recommendations designed to mitigate the combined impact of the loosened environmental regulatory framework created by Bill 132. A number of organizations that testified in front of the Standing Committee, including the Canadian Environmental Law Association, also noted that the consultation period was too brief for such a large and complex bill.

The Ontario government’s broader agenda on red tape reduction is outlined in a backgrounder which included the regulatory measures already announced: reducing barriers for food banks and soup kitchens and allowing dogs on restaurant/brewery patios.

Other legislation

Animal welfare legislation- How it could impact the sector more broadly

ONN is watching Bill 136 because of potential implications for other nonprofits and charities with statutory obligations and we’re watching Bill 156 because of its potential impact on nonprofit advocacy. Animal welfare has been established as a charitable purpose under Canadian common law.

Bill 136, Provincial Animal Welfare Services (PAWS) Act, 2019, received Royal Assent on December 5, 2019, after passing third reading with unanimous support from the Legislature. The PAWS Act creates a new legislative framework for addressing animal abuse following a judge’s ruling (since overturned by the Ontario Court of Appeal) that the previous legislative framework was unconstitutional because it gave police powers to  a charity, the Ontario Society For the Prevention of Cruelty to Animals (SPCA) and Humane Society, without imposing accountability and transparency standards.

  • Bill 136 establishes new offences and harsher penalties for harming an animal; strengthens the complaints mechanism for reports of abuse; and empowers designated persons to help animals in distress, such as those in hot vehicles.
  • The law gives the Province enforcement powers including for farm animals, zoos, aquariums, and horses, starting January 1, 2020. (The government has already launched an animal abuse hotline.)
  • Animal welfare groups have expressed support for Bill 136, although with some qualifications. Until it comes into effect, the existing animal welfare regime (updated on an interim basis by Bill 117 in June 2019) remains in force.

Bill 156, Security from Trespass and Protecting Food Safety Act, 2019, started second reading on December 10. The bill increases fines for trespassing on farms and meat processing facilities and makes it illegal to obstruct trucks carrying farm animals or even to interact with the animals on board.

Mental health legislation

ONN is watching Bill 116 because mental health in the workplace is a critical part of Decent Work.

Bill 116, Foundations for Promoting and Protecting Mental Health and Addictions Services Act, 2019, received Royal Assent on December 12. 

  • Schedule 1 enacts the Mental Health and Addictions Centre of Excellence Act, 2019. The Ontario Health super-agency will host the Centre of Excellence and implement the strategy through an integrated health care delivery system. The Centre will operationalize the strategy, set standards and performance metrics for the system, and provide “resources and support to health service providers, integrated care delivery systems and others related to mental health and addictions.”
  • Schedule 2 enacts the Opioid Damages and Health Care Costs Recovery Act, 2019, which enables Ontario to join class action lawsuits against an “opioid-related wrong.”

Legal aid legislation

On December 9, the Attorney General tabled Bill 161, the Smarter and Stronger Justice Act.

  • The bill is intended to modernize the justice system, including the Legal Aid Services Act (see Schedules 15 and 16) which governs Legal Aid Ontario (LAO) and the Legal Aid Fund, along with laws governing class action suits, court processes, legal document verification, and more. 

Schedule 8 amends the Crown Liability and Proceedings Act.

  • The government press release announcing the legislation noted that “following extensive consultations, LAO’s 2020-2021 funding will be maintained at its current levels.” Previously, the Ontario government had planned to cut a further $31 million from the LAO budget in addition to the $133 million cut implemented in Budget 2019.
  • Legal aid lawyers, represented by the Society of United Professionals, have expressed their opposition to the bill because it removes “access to justice” and “low income individuals” from the purpose of the Legal Aid Services Act and weakens the right of low-income Ontarians to legal representation in criminal, family, clinic, and mental health matters.

The bill will continue its progress through the house in 2020.

Lobbyist Registration Act updates

We normally don’t report on private members’ bills until they pass because they often don’t make it to third reading and in many cases are only symbolic. But we’ll keep an eye on MPP Randy Hillier’s Bill 162, the Public Accountability and Lobbyist Transparency Act, tabled on December 9.

  • Bill 162 would amend the Lobbyists Registration Act. Registered lobbyists would have to track individual meetings (as they do for the Government of Canada and the City of Toronto registries) rather than simply reporting on lobbying goals, activities, and “targets” (politicians and public servants) every six months.

If the bill proceeds, ONN would continue to argue for public benefit nonprofits to be exempt from this legislation as it imposes an undue administrative burden on them (the Province of Alberta has made this exemption).

Consumer protection legislation

On December 5, 2019, the Minister of Government and Consumer Services tabled Bill 159, Rebuilding Consumer Confidence Act, 2019.

  • Schedule 7 updates the Retirement Homes Act, with changes to the board composition of the Retirement Homes Regulatory Authority and to strengthen the provisions preventing the Ontario government from being held legally liable with respect to the activities of the Authority.
  • Using a special procedure, the Legislature allowed the bill to skip second reading debate and fast-tracked it to the Standing Committee on December 11.

Financial Accountability Office (FAO) reports

New publication released by the Ontario Legislature’s FAO

  • ONN is pleased to see a new publication from the FAO which helps the public understand in-year changes to provincial spending between provincial budgets.
    Expenditure Monitor 2019-20: Q2 was released on December 2. The FAO provides independent analysis on the state of the Province’s finances, trends in the provincial economy, and related matters important to the Legislative Assembly of Ontario.
  • The report provides updated information on actual spending in 2019-2020 – or at least the 96 per cent of the provincial budget that is controlled and monitored by the Ontario government (as opposed to the smaller portion that is controlled by the broader public sector).
  • The report compares actual spending at September 30 to planned spending for the same period.
  • Some highlights:
    • Health sector spending, at $28.9 billion, was $503 million, or 1.8 per cent, higher than planned through the first six months of the fiscal year.
    • The Employment Ontario Program was $85 million, or 15 per cent, below planned spending.
    • Children’s and Social Services sector spending, at $8.6 billion, was $318 million, or 3.8 per cent, higher than planned through the first six months of the fiscal year.
    • Children and Adult Services Program – Financial and Employment Supports, which includes the Ontario Disability Support Program, Ontario Works and the Ontario Drug Benefit Plan, was $272 million, or 6 per cent, above planned spending.
    • Children and Adults Services Program – Children and Youth at Risk, which provides child protection services, was $65 million, or 7 per cent, above planned spending.
    • Justice sector spending, at $2.3 billion, was $31 million, or 1.3 per cent, lower than planned through the first six months of the fiscal year.
    • In terms of ministry spending, Economic Development, Job Creation and Trade is almost 30% underspent; Indigenous Affairs is almost 32% underspent; and Infrastructure is almost 51% underspent relative to planned spending for the first six months of the year.
    • The report also provides a helpful account of spending changes by program and notes that the Province will likely have to table Supplementary Estimates to account for the increased spending total. At the same time, while one would expect program expenditures to fall near the 50 per cent mark at the end of Q2, some programs are as low as 26 per cent (Youth Initiatives), 27.4 per cent (Grants in support of culture), or 37.9 per cent (Citizenship and immigration initiatives). This under-spending correlates to the delays in getting money out the door that ONN heard about from nonprofits in our Sector 360° province-wide survey.

The FAO also released its annual Fall Economic and Budget Outlook Report on December 9. Peter Weltman, Ontario’s Financial Accountability Officer, expressed concern that the government’s budget plan includes tax cuts and spending programs that are not reflected in current legislation and have not been formally proposed by the government. According to the annual report, “if the government achieves its spending plan, program spending would be reduced by $1,070 per person, or by 10 per cent, over the next five years.”

The FAO estimates that demand for public services will exceed the government’s planned spending by approximately $5 billion by 2021-22. The overall message of the report is that the government will have to raise taxes, cut programs drastically, or benefit from good fortune (e.g., lower interest payments, a change in federal transfers) in order to adhere to its targets over the next three years.

What didn’t happen and what comes next?

What didn’t happen this fall?

What comes next?

It’s almost pre-Budget consultation season. Let’s keep working together to promote an enabling policy environment for Ontario nonprofits.

You can make your voice heard by

Check out the webinar ONN did last year on how to write a pre-budget submission.

The Legislature returns on February 18, 2020.