There are two things you can count on when Premier Doug Ford’s government updates Ontarians on the state of the province’s finances.
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government → be → finances
First, the deficit will be higher than what was projected just months before, and second, the date when the budget will be balanced will be pushed back, again.
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budget → project → ?
Finance Minister Peter Bethlenfalvy delivered exactly as expected in his fall fiscal update Thursday.
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Bethlenfalvy → deliver → update
He says the deficit will be up this year and next, and the elusive budget balance will be delayed.
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balance → say → ?
Given the government’s deteriorating financial position, one would have hoped to see some rational action on its ridiculously expensive power-bill subsidies, which cost $6.9 billion last year.
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which → give → billion
Instead, baby steps were taken.
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steps → take → ?
Bethlenfalvy announced Thursday that the government would cap its biggest single subsidy, the Ontario Energy Rebate (OER), at 1,200 kilowatt-hours monthly for residential users.
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government → announce → users
Given that the average residential consumer uses 700 kilowatt-hours per month, that’s a modest step indeed.
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that → give → month
The change at least limits the size of the energy rebate for those who have the biggest houses and use the most power.
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who → limit → power
Since the energy rebate is paid as a percentage of the bill, people who consume a lot of power get more help every month than those who conserve.
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who → pay → those
That doesn’t make sense.
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That → make → sense
The Ford government has also quietly made one additional change to the power-bill subsidy that might be beneficial if it proves to be the start of a trend.
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it → make → trend
A year ago, the Ford government sharply increased the power subsidy rate, boosting it from 13.1 per cent because power rates had just jumped 29 per cent due to higher nuclear costs.
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rates → increase → costs
Rather than trying to sell that challenge to the public, the government doubled up on the subsidy.
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government → try → subsidy
This year, the provincial government got a break.
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government → get → break
Power rates over the next 12 months are expected to be lower.
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rates → expect → months
It’s a temporary downturn in prices, but the government took advantage of the moment to cut the OER, keeping consumer bills stable.
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government → ’ → bills
The question is, what happens next?
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what → happen → ?
So far, the government has no apparent strategy on power-rate subsidies, other than to take the most politically expedient course in the short term.
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government → have → term
Energy Minister Stephen Lecce said during a discussion of his department’s estimates earlier this year that he wants to “bell-curve” the subsidy, but it’s not a battle he has won yet.
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he → say → subsidy
The subsidies are nothing more than an ill-conceived effort to shield consumers from the real cost of power by using tax dollars to subsidize their bills.
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subsidies → conceive → bills
In effect, the government is “saving” people money by taking less money from one pocket and more from the other.
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government → save → other
With its long string of deficits, the Ford government is, in effect, borrowing money so people don’t have to pay their real power bills.
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people → borrow → bills
For the government, the cost of its various subsidy programs is huge and rising steadily as real power prices increase.
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prices → rise → programs
In 2020, total subsidies amounted to $4.2 billion.
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subsidies → amount → billion
That’s unsustainable now and, as power prices continue to rise with the introduction of expensive new nuclear generation, it’s going to get worse.
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it → ’ → generation
If it were to cut subsidies, the Ford government would be accused of increasing power bills, even though all it would do is make people pay the actual cost of their bill.
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people → cut → bill
That doesn’t seem like too much to ask.
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That → seem → much
Power-bill subsidies might seem odd, but they have a long history in Ontario.
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they → seem → Ontario
Going into the 2018 election, the cost of electricity was a hot issue, with an Ipsos poll showing 61 per cent saying it would affect their vote.
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it → go → vote
Despite bringing in power-bill subsidies in 2017, then premier Kathleen Wynne and her Liberal government were on the hot seat.
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Wynne → bring → seat
Ford and the PCs saw an opportunity and promised to reduce power bills by 12 per cent, the sort of non-round figure that makes it sound like a real plan.
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it → see → plan
Once in power, the PCs found cutting power bills wasn’t so easy.
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cutting → find → bills
They did try, pulling the plug on the Liberals’ green energy approach and cancelling more than 700 renewable energy contracts.
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They → try → contracts
Bills still edged up.
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Bills → edge → ?
By 2019, the PCs decided that borrowing money to subsidize power bills wasn’t such a terrible idea after all and brought in the OER.
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borrowing → decide → OER
It’s a worse one now.
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It → ’ → ?
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