2025 Budget – Will the same old policy levers bring in new results?
The Ontario provincial budget was released after a busy political cycle. Two snap elections, the sudden deterioration of Canada-U.S. relationship, and the global trade war are framing the provincial government’s priorities. Over the next two years, Ontario paints a bleak economic picture despite inflation reaching targeted levels: slow GDP and employment growth compared to previous years and the lowest consumer and business confidence since the pandemic.
However, much of the policy levers the Ontario government is investing in to protect Ontario are more of the same: building infrastructure, tax credits, parking money in pots designed to leverage private investment, learn and stay grants to fill health care staffing needs, and bolstering skilled trades.
The real question is will they yield new and better results? Will they meet the moment?Notably missing from the budget are any significant investments in education (beyond capital investments), and housing of any kind. Housing starts are lower than expected and the 1.5 million goal seems further away than before.
Stronger community services = stronger economy
The budget notes that Ontario needs a strong economy to invest in high quality social services. However, this premise is false as social services and the broader nonprofit sector help drive the economy as employers, purchasers of goods and services, and stewards of land. As the province prepares to weather economic shock from the tariffs and any resulting economic downturn, it is neglecting the importance of the nonprofit ecosystem to both the economy and the vitality and wellness of Ontario’s communities. Taking a note from their COVID playbook, the lack of new investments signal that the province might be waiting to see how the federal budget rolls out in the fall.
What is in Ontario’s 2025 budget?
The 2025 budget projects $232.5B in expenses, $219.9B in revenue, resulting in a $14.6B deficit (10x higher than what was forecasted in the fall). Decreases in government revenues and higher costs are contributing to the deficit. Program spending is expected to increase by 1.8 per cent in fiscal year 2025-26, while revenues are expected to fall by 0.8 per cent.
Compared to last year, here are the base funding for line ministries providing funding to nonprofits:
- Children, Community and Social Services forecasted to decrease by one per cent
- Health forecasted to increase by one per cent
- Municipal Affairs and Housing base funding remains the same
- Labour, Training and Skills Development decreased by 32 per cent
- Seniors and Accessibility increased by 13 per cent
- Education increased by seven per cent.
What’s in the budget for Ontario’s nonprofit sector?
- $303M over the next three years to the community-based mental health and addictions services sector. This commitment will provide a four per cent increase in the sector’s base funding to support community-led and delivered mental health programs.
- $207 million over three years through the Ontario Research Fund to provide Ontario institutions with funding to acquire infrastructure and engage in global R&D.
- $175M in 2025-26 for the Ontario Autism Program.
- $70M over four years for the Indigenous Participation Fund to improve Indigenous communities’ and organizations’ capacity to participate in regulatory processes related to mineral exploration and mine development.
- $50M over five years through Invest Ontario to grow the province’s industrial capacity in modular construction and other innovative options to accelerate development, improve affordability, and nurture home-grown industries that support quality jobs in Ontario.
- $20M in 2025-26 to mobilize new training and support centres, formerly known as action centres.
- $16.5M in 2025-26 for the Black Youth Action Plan.
- $12.8M for the anti-hate security and prevention grant.
- $10M over the next two years for the Rural Ontario Development (ROD) program for projects that support communities, rural businesses, and entrepreneurs in addressing barriers to business development and growth.
- $3M over the next three years to establish a dedicated veteran-focused funding stream within the existing Seniors Community Grant Program.
It is imperative that these investments reach our sector quickly and transparently.
Potential opportunities for nonprofits to influence funding
- $5B for the Protecting Ontario Account (POA) designed to provide businesses with up to $1 billion in immediate liquidity relief aimed at protecting Ontario businesses and workers facing tariff-related business disruptions. Will nonprofits be eligible?
- $40M in flexible grants in 2025-26 for the Trade-Impacted Communities Program (TICP) which will support projects that help communities respond to trade disruptions and pivot to procurement from domestic and local suppliers where possible. The program will also support large-scale strategic initiatives that enable and transform key sectors and industrial clusters to help businesses grow, find new markets and investments, and diversify their supply chains. Will nonprofits be eligible?
- $5B to increase the Building Ontario Fund to co-invest in key priority areas such as long-term care, energy infrastructure, and affordable housing. Can we make it accessible and work for nonprofits wanting to build?
- $56B over the next 10 years for building health infrastructure. Can these investments be leveraged to deliver community benefits?
What others are saying
A collection of responses from advocacy organizations and groups and media.
Advocates
- AdvantAge Ontario
- Association of Municipalities of Ontario
- CCPA
- Chiefs of Ontario
- Children’s Mental Health
- CUPE
- Environmental Defence
- Elementary Educators
- Feed Ontario
- OFL
- Ontario Chamber of Commerce
- OPSEU
- WoodGreen Community Services
