Media Release: Ontario’s budget is not expected to be balanced by 2029-30


[La version française suit le texte anglais.]                                                               


TORONTO, June 10, 2021 - Today, the Financial Accountability Office of Ontario (FAO) released its 2021 Spring Economic and Budget Outlook. This report provides an assessment of Ontario’s current economic outlook and the provincial government’s finances.

The COVID-19 pandemic caused a severe decline in economic activity in 2020. However, the FAO expects the economy to rebound strongly over the next two years, driven by progress in vaccinations, improving global demand and ongoing monetary and fiscal policy support.

The FAO projects smaller deficits compared to the government over the medium term. Rising revenues will help lower the budget deficit to $11.1 billion by 2023-24, well below the government’s $18.7 billion projection and a significant improvement from a record $35.8 billion deficit in 2020-21.

The 2021 Ontario budget included a recovery plan that projected a path to fiscal balance by 2029-30. The government’s plan relies on prolonged spending restraint requiring significant and permanent cost savings that would lower real program spending by $1,281 per Ontarian.

According to the FAO’s projection, the government is not expected to achieve a balanced budget by 2029-30. The FAO expects a deficit of $6.9 billion in 2029-30 under current policies, $9.3 billion below the government’s projected $2.4 billion surplus.

Even with ongoing budget deficits, the FAO expects Ontario’s fiscal indicators, including the province’s net debt-to-GDP ratio and interest on debt as a share of revenue, to improve gradually over the recovery plan.

To learn more, read the full report here.

Quick facts:

  • Ontario real GDP is projected to rise by 5.8 per cent in 2021 and 4.0 per cent in 2022.
  • As of May 2021, employment remains down by 307,300 jobs (or -4.1 per cent) compared to the pre-pandemic level in February 2020.
  • Significant income support from government helped boost the household savings rate from -0.6 per cent in 2019 to 13.4 per cent in 2020, the highest since 1993.
  • The net debt-to-GDP ratio is projected to jump to 47.6 per cent in 2023–24, eight percentage points higher than the pre-pandemic ratio of 39.6 per cent in 2019–20.
  • Program spending is expected to grow by an average of 3.0 per cent annually over the recovery plan – twice the pace of the government’s planned spending growth of 1.5 per cent.
  • The FAO estimates that the budget’s revenue forecast is lower than what the government’s economic outlook would suggest by $1.4 billion in 2022-23 and $2.2 billion in 2023-24. Although not announced in the budget, these revenue shortfalls suggest planned tax cuts.

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 and follow us on Twitter at


For further information, please contact:
Anna Giannini  l  647.527.2385  l  |