FOR IMMEDIATE RELEASE
[La version française suit le texte anglais.]
ONTARIO SPENT $10.3 BILLION LESS THAN PLANNED IN 2020-21
TORONTO, July 21, 2021 - Today, the Financial Accountability Office of Ontario (FAO) released its Expenditure Monitor 2020-21: Q4 report. This report provides information on spending by the Province through the end of the 2020-21 fiscal year (March 31, 2021), including changes to the 2020-21 spending plan, unaudited spending results, an updated budget deficit projection, and the year-end status of the Province’s three unallocated funds (the Health Fund, Support for People and Jobs Fund, and Contingency Fund).
During the 2020-21 fiscal year, the Province increased its spending plan by $22.1 billion (13.4 per cent) to $187.3 billion. By program, the largest funding increases during the year went to hospital operations ($5.4 billion), support for municipalities and municipal transit agencies ($4.1 billion), the Ontario Small Business Support Grant ($3.4 billion), payments to families with children ($1.5 billion), and long-term care homes ($1.5 billion).
Although the Province increased its 2020-21 spending plan during the year by $22.1 billion to $187.3 billion, by the end of 2020-21 unaudited spending was only $177.0 billion. Overall, this was $10.3 billion (5.5 per cent) less than planned. All sectors spent less than planned, led by ‘other programs’ ($3.7 billion or 10 per cent under plan), interest on debt ($1.1 billion or 9.1 per cent under plan) and health ($1.0 billion or 1.5 per cent under plan). There was also a $3.4 billion end-of-year balance in the Contingency Fund that was not spent.
Compared to 2019-20, spending in 2020-21 was up $21.3 billion (13.7 per cent). The year-over-year spending increase is significantly above the recent average annual growth rate and reflects government spending in response to the COVID-19 pandemic. Health sector spending in 2020-21 was up $9.3 billion (15.5 per cent) compared to 2019-20, while education sector spending increased by $2.6 billion (8.2 per cent), which included both direct payments to families with children and funding for school boards.
Based on the spending information reflected in this report, and the FAO’s most recent revenue forecast, the FAO projects the 2020-21 budget deficit will be $29.3 billion. This is an improvement of $9.2 billion compared to the Province’s 2020-21 budget deficit projection of $38.5 billion in the 2021 Ontario Budget. Compared to the Province’s projection, the FAO’s 2020-21 budget deficit forecast includes higher projected revenue, as the outlook for Ontario’s economy has improved, and lower projected spending, reflecting the more up-to-date information available to the FAO.
To learn more, read the full report here.
- The Province started the 2020-21 year with a total of $5.1 billion in unallocated funds through three programs: the Health Fund, the Support for People and Jobs Fund (SPJF) and the Contingency Fund.
- During the year, the Province added a combined $14.7 billion to the three funds, bringing total available funds to $19.8 billion.
- After accounting for transfers to government programs, the remaining year-end balances in the Health Fund and SPJF were zero, while the remaining balance in the Contingency Fund was $3.4 billion.
- Payments to physicians in 2020-21 was down $1.3 billion (7.9 per cent) compared to planned spending at the start of the year, reflecting the impact of the COVID-19 pandemic on the demand for physician services.
- Other notable year-over-year spending increases went to support for municipalities and municipal transit agencies ($4.1 billion), the Ontario Small Business Support Grant ($3.4 billion), COVID-19-related energy subsidy programs ($0.8 billion), homelessness programs from the pandemic-related Social Services Relief Fund ($0.7 billion), and the procurement of personal protective equipment (PPE) and other COVID-19-related supplies ($0.4 billion).
About the FAO
Established by the Financial Accountability Officer Act, 2013, the Financial Accountability Office (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. Visit our website at http://www.fao-on.org/en/ and follow us on Twitter at https://twitter.com/InfoFAO.