Highlights

  • Ontario’s real gross domestic product (GDP) increased 0.4 per cent in the third calendar quarter of 2022, following a 0.9 per cent gain in the second quarter of 2022. Real GDP in the third quarter was 4.0 per cent above the pre-pandemic level in the fourth quarter of 2019.
  • Compared to the 2022 Ontario Economic Outlook and Fiscal Review (also referred to as the Fall Economic Statement, or FES), the estimated projection for both real and nominal GDP growth in 2022 has been revised upwards, while the private sector projection for real and nominal GDP growth in 2023 has been revised downwards.
  • As of the 2022–23 Third Quarter Finances, the province’s 2022–23 deficit is projected to be $6.5 billion — $13.3 billion lower than the outlook published in the 2022 Budget, and $6.4 billion lower than the 2022 Ontario Economic Outlook and Fiscal Review, primarily due to higher than forecast taxation revenues. Similar updates have been seen in other jurisdictions across Canada.  
  • Revenues in 2022–23 are projected to be $16.6 billion higher than forecast in the 2022 Budget and $9.6 billion higher than expected in the 2022 Ontario Economic Outlook and Fiscal Review, mainly reflecting stronger than expected taxation revenues as a result of higher net tax assessments for 2021 and prior years, based on new information from the Canada Revenue Agency, received since the release of the 2022 Ontario Economic Outlook and Fiscal Review.
  • Overall program expense in 2022–23 is projected to be $188.6 billion, $3.4 billion higher than forecast in both the 2022 Budget and the 2022 Ontario Economic Outlook and Fiscal Review, mostly due to significant one-time costs associated with ongoing land and land-related claims with Indigenous communities.

Introduction

Amid global geopolitical conflict, high inflation, rising interest rates and ongoing supply chain challenges, Ontario’s economy has remained resilient in the face of ongoing uncertainty, with real gross domestic product (GDP) estimated to have increased by 3.7 per cent in 2022.

Ontario’s economy is not immune to an expected economic slowdown in 2023, as demonstrated by private sector forecasters revising their GDP forecasts lower, on average, for that year, since the release of the 2022 Ontario Economic Outlook and Fiscal Review. That is why the government is maintaining its responsible fiscal plan, which includes ensuring fiscal policy works in tandem with monetary policy, while delivering on its Plan to Build.

Against this backdrop, the government is remaining transparent and accountable by releasing the 2022–23 Third Quarter Finances, which provides updated information about the evolution of Ontario’s economic and fiscal outlook since the release of the 2022 Ontario Economic Outlook and Fiscal Review.

The government plans to provide its next economic and fiscal update as part of the 2023 Budget, on or before March 31, 2023.

Section A: Ontario’s 2022–23 Fiscal Outlook

The province’s 2022–23 deficit is projected to be $6.5 billion — $13.3 billion lower than the outlook published in the 2022 Budget, and $6.4 billion lower than the 2022 Ontario Economic Outlook and Fiscal Review, primarily due to higher than forecast taxation revenues.

Revenues in 2022–23 are projected to be $196.4 billion, $16.6 billion higher than forecast in the 2022 Budget and $9.6 billion higher than projected in the 2022 Ontario Economic Outlook and Fiscal Review. The increased revenue forecast reflects stronger than expected taxation revenues as a result of higher net tax assessments for 2021 and prior years, based on new information received from the Canada Revenue Agency since the release of the 2022 Ontario Economic Outlook and Fiscal Review. Similar to other provinces, Ontario incorporates updated information received from the Canada Revenue Agency into its regular financial updates.

Overall program expense in 2022–23 is projected to be $188.6 billion, $3.4 billion higher than forecast in both the 2022 Budget and the 2022 Ontario Economic Outlook and Fiscal Review. Increases in program expense since the release of the 2022 Ontario Economic Outlook and Fiscal Review are primarily due to significant one-time costs associated with ongoing land and land-related claims with Indigenous communities, where Ontario is in active negotiations, or claims are accepted for negotiation or are under reviewfootnote 1.

Other program expense increases since the release of the 2022 Ontario Economic Outlook and Fiscal Review include: spending related to reopening of colleges and its resulting additional on-campus activity; the government’s commitment to support the City of Toronto, to address a portion of its 2022 operating deficit; and additional funding for prevention and containment of COVID-19 at long-term care homes. These expenses have been partially offset by additional third-party revenues from colleges, ministry underspending, particularly for infrastructure projects, and through the drawdown of existing contingencies within the fiscal plan.

Interest on debt is projected to be $13.4 billion, slightly lower than the $13.5 billion forecast in the 2022 Budget and approximately $0.2 billion lower than the $13.6 billion projection in the 2022 Ontario Economic Outlook and Fiscal Review,due to a lower deficit than previously estimated partially offset by higher than forecast interest rates.

As a result of the lower deficit, the net debt-to-GDP ratio is projected to be 38.3 per cent in 2022–23, 3.1 percentage points lower than the 41.4 per cent forecast in the 2022 Budget and 0.1 percentage points lower than projected in the 2022 Ontario Economic Outlook and Fiscal Review.

The 2022 Budget included a $1.0 billion reserve in 2022–23, to protect the fiscal outlook against any unforeseen changes in the province’s revenue and expense forecasts. This reserve has been maintained as part of the current fiscal outlook. It provides additional prudence in the government’s fiscal framework and is distinct from contingency funds that set aside dedicated funding to be allocated in response to emerging needs. If not needed, the reserve is eliminated at year-end as part of the final projection for 2022–23 published in the 2023 Budget.

Table 1
2022–23 In-Year Fiscal Performance
($ Millions)
Item2022 BudgetCurrent OutlookIn-Year Change
Revenue179,798196,44716,649
Expense — Programs185,163188,5543,392
Expense — Interest on Debt13,48513,442(43)
Total Expense198,648201,9963,349
Surplus/(Deficit) Before Reserve(18,850)(5,549)13,301
Reserve1,0001,000
Surplus/(Deficit)(19,850)(6,549)13,301

Notes: Numbers may not add due to rounding. Current outlook primarily reflects information available as of December 31, 2022, as well as other significant updates to the fiscal plan.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Revenue

Revenues in 2022–23 are projected to be $196.4 billion, $16.6 billion higher than forecast in the 2022 Budget and $9.6 billion higher than forecast in the 2022 Ontario Economic Outlook and Fiscal Review.

The forecast for Total Taxation Revenue increased by $8.7 billion, compared to the 2022 Ontario Economic Outlook and Fiscal Review. Key changes in the taxation revenue outlook, compared to the 2022 Ontario Economic and Fiscal Review, include:

  • Corporations Tax revenue increased by $5.0 billion, mainly due to higher amounts from processing 2021 and prior year tax returns by the Canada Revenue Agency;
  • Sales Tax revenue increased by $3.4 billion, largely due to an upward revision by the federal government, in December of 2022, to Ontario’s 2021 HST official entitlements;
  • Personal Income Tax revenue increased by $0.5 billion, mainly due to higher compensation of employees growth for 2022, reflecting strong growth in employment;
  • Land Transfer Tax is $233 million lower, reflecting slowing activity in the housing market; and
  • All Other Taxes combined increased by $83 million, mainly due to higher revenues from the Gasoline Tax and Education Property Tax, partially offset by lower revenues from the Employer Health Tax, Ontario Health Premium and Fuel Tax.

Net income from Government Business Enterprises is $251 million higher, mainly due to higher net income from Ontario Power Generation, reflecting higher production and lower costs, and partially offset by lower revenue from the LCBO, reflecting lower than anticipated sales.  

Projected Government of Canada Transfers decreased by $207 million since the release of the 2022 Ontario Economic Outlook and Fiscal Review, mainly due to lower revenues received as a result of slower than expected progress on projects under the Investing in Canada Infrastructure Program.

Other Non-Tax Revenues combined are projected to increase by $898 million, due to higher third-party revenues from colleges reflecting projected growth in international student enrolments and revenues from other on-campus services.

Table 2
Key Changes to 2022–23 Revenue Projections
($ Millions)
Item2022–23
2022 Budget Total Revenue Outlook179,798
Revenue Changes in the 2022–23 First Quarter Finances1,204
Revenue Changes in the 2022 Ontario Economic Outlook and Fiscal Review5,820
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Corporations Tax4,960
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Sales Tax3,420
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Personal Income Tax453
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Land Transfer Tax(233)
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — All Other Taxes83
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Total Taxation Revenue8,683
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Government of Canada Transfers(207)
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Government Business Enterprises251
Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Other Non-Tax Revenue898
Total Revenue Changes Since the 2022 Ontario Economic Outlook and Fiscal Review9,626
2022–23 Third Quarter Finances Total Revenue Outlook196,447

Notes: Numbers may not add due to rounding. Current outlook primarily reflects information available as of December 31, 2022, as well as other significant updates to the fiscal plan.

Source: Ontario Ministry of Finance.

Additional developments could materially affect the 2022–23 revenue outlook as new information becomes available during and well after the end of the 2022–23 fiscal year. These include changes to the economic growth outlook, the results from 2022 tax return processing, revenue collections from Ontario-administered taxes and the earnings of government business enterprises. The government will monitor these developments and provide further details in future fiscal updates.

Expense

Total expense is projected to be $202.0 billion, or $3.3 billion higher than the 2022 Budget projection and $3.2 billion higher than the projection at the time of the 2022 Ontario Economic Outlook and Fiscal Review. Changes to expense since the release of the 2022 Ontario Economic Outlook and Fiscal Review are largely driven by ongoing land and land related claims with Indigenous communities, where Ontario is in active negotiations, or claims are accepted for negotiation or are under review.

Other program expense increases include: spending related to reopening of colleges following the easing of public health restrictions and resulting additional on-campus activity; the government’s commitment to support the City of Toronto, to address a portion of its 2022 operating deficit; and additional funding for prevention and containment of COVID-19 at long-term care homes. These expenses have been partially offset by additional third-party revenues from colleges, ministry underspending, particularly for infrastructure projects, and through the drawdown of existing contingencies within the fiscal plan.

Table 3
Key Changes to 2022–23 Total Expense Projections
($ Millions)
Item2022–23
2022 Budget Total Expense Outlook198,648
Total Expense Changes in the 2022–23 First Quarter Finances105
Total Expense Changes in the 2022 Ontario Economic Outlook and Fiscal Review 15
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Land and Land Related Claims5,000
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — College Sector Spending – Consolidation727
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Support for a Portion of the City of Toronto’s 2022 Operating Deficit235
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Prevention and Containment of COVID‑19 in Long-Term Care Homes183
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Additional Funding for the Alcohol and Gaming Commission of Ontario35
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Additional Resources for the Landlord and Tenant Board and Ontario Land Tribunal4
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Enhancement of Emergency Management Ontario3
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Ontario Student Assistance Program (OSAP) Underspending(90)
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Ministry of Economic Development, Job Creation and Trade Savings(102)
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Public Safety Radio Network (PSRN) Underspending(155)
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Ministry of Infrastructure Program Underspending(700)
Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — Total Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review — All Other Changes(10)
Total Program Expense Changes5,130
Net Drawdown of the Contingency Fund(1,738)
Total Net Program Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review3,392
Interest on Debt Change Since the 2022 Ontario Economic Outlook and Fiscal Review(163)
Total Expense Changes Since the 2022 Ontario Economic Outlook and Fiscal Review 3,229
2022–23 Third Quarter Finances Total Expense Outlook201,996

Notes: Numbers may not add due to rounding. Current outlook primarily reflects information available as of December 31, 2022, as well as other significant updates to the fiscal plan.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Program Expense Update

Total program expense in 2022–23 is projected to be $188.6 billion, $3.4 billion higher than forecast in both the 2022 Budget and the 2022 Ontario Economic Outlook and Fiscal Review. Increases in program expense since the release of the 2022 Ontario Economic Outlook and Fiscal Review are primarily due to significant one-time costs associated with ongoing land and land-related claims with Indigenous communities.

Details of key changes to program expense projections since the release of the 2022 Ontario Economic Outlook and Fiscal Review include the following:

  • $5.0 billion in one-time expense associated with ongoing land and land related claims with Indigenous communities, where Ontario is in active negotiations, or claims are accepted for negotiation or are under review;
  • $727 million in accounting adjustments for higher than forecast college sector spending from increased on-campus activities following the easing of public health restrictions, offset by third-party revenues;
  • $235 million to support a portion of the City of Toronto’s operating deficit with up to one third of the city’s projected 2022 COVID-19 pressures, ensuring continued operations and the provision of public services;
  • $183 million to help long-term care homes prevent and contain the spread of COVID-19, including increased staffing supports;
  • $35 million to support the operations of the Alcohol and Gaming Commission of Ontario, primarily as a result of reduced recoveries from regulated sectors;
  • $4 million for additional resources for the Landlord and Tenant Board and Ontario Land Tribunal, to improve service standards and facilitate the faster resolution of disputes in order to increase housing supply; and
  • $3 million in additional funding to support increased capacity at Emergency Management Ontario, to better respond to future public health threats.

Other changes to program expense, representing ministry savings and underspending, are outlined below. Through the course of the year, circumstances may give rise to savings and underspending due to effective fiscal management to obtain greater value for money, changes to program take-up, federal program changes, delays by project partners outside of the government’s direct control and other factors:

  • $90 million in underspending in the Ministry of Colleges and Universities, related to lower than expected student uptake for financial assistance;
  • $102 million in underspending for the Ministry of Economic Development, Job Creation and Trade, due to updated timing of initiative delivery into future years;
  • $155 million in underspending in the Ministry of the Solicitor General, related to the Public Safety Radio Network;
  • $700 million in underspending in the Ministry of Infrastructure, accompanied by a reduction in federal revenue of $170 million, due to revised implementation timelines for a number of planned infrastructure projects, including those related to high-speed internet and the Investing in Canada Infrastructure Program; and
  • All Other Changes of $10 million in underspending.

$1.7 billion in program expense changes have been offset from contingencies.

Interest on Debt Expense Update

Interest on debt expense is projected to be $13.4 billion, slightly lower than the $13.5 billion forecast in the 2022 Budget and approximately $0.2 billion lower than the $13.6 billion projection in the 2022 Ontario Economic Outlook and Fiscal Review. Due to rising interest rates, Ontario’s cost of borrowing has, however, increased to 4.0 per cent, which is higher than the 3.4 per cent forecast in the 2022 Budget but lower than the 4.2 per cent forecast in the 2022 Ontario Economic Outlook and Fiscal Review.

Fiscal Prudence

The Fiscal Sustainability, Transparency and Accountability Act, 2019 requires Ontario’s fiscal plan to incorporate prudence in the form of a reserve to protect the fiscal outlook against unforeseen changes in the province’s revenue and expense, including those resulting from Ontario’s economic performance. The 2022 Budget included a reserve of $1.0 billion in 2022–23, which has been maintained as part of the current fiscal outlook. If not needed, the reserve is eliminated at year-end as part of the final projection for 2022–23 published in the 2023 Budget. In addition, the Contingency Fund is maintained to help mitigate expense risks — for example, in cases where health and safety may be compromised, and for contingent liabilities associated with claims by Indigenous communities – and unforeseen events which may otherwise adversely affect Ontario’s fiscal performance. The remaining balance of the Contingency Fund is projected to be $1.8 billion for 2022–23.

Section B: Ontario’s Recent Economic Performance and Outlook

Recent Economic Performance

In the third calendar quarter of 2022, Ontario’s real gross domestic product (GDP) recorded its fifth consecutive quarter of growth, increasing 0.4 per cent and thus exceeding the pre-pandemic level by 4.0 per cent at the end of the fourth quarter of 2019. However, Ontario’s real GDP growth slowed from a 0.9 per cent increase in the second quarter of 2022, particularly in interest rate sensitive sectors such as consumer spending and housing, which coincided with continued tightening of monetary policy by the Bank of Canada.

Ontario’s labour market remained strong in 2022, with employment rising by 338,300, following a gain of 367,400 in 2021. Most of the net employment gains in 2022 were in full-time (84 per cent of the total), private sector (74 per cent of the total) jobs. In addition, the unemployment rate remained near historic lows, ending the year at 5.3 per cent in December 2022.

Chart 1: Ontario Employment Gains in 2022
Accessible description of Chart 1: Ontario Employment Gains in 2022

Like many other economies around the world, inflation in Ontario rose strongly in 2022, in part due to a rebound in demand, supply chain disruptions and higher commodity prices further exacerbated by Russia’s invasion of Ukraine. Over the last several months, inflation pressures have begun to ease but remain elevated. Ontario’s Consumer Price Index (CPI) increased 6.0 per cent in December 2022, compared to a year earlier, moderating from a recent peak of 7.9 per cent in June 2022.

Economic Outlook

The outlook for global growth has weakened, partly due to the impacts of tighter monetary policy as central banks around the world address elevated price inflation. The International Monetary Fund estimates global real GDP grew 3.4 per cent in 2022, and projects real GDP to increase 2.9 per cent in 2023. U.S. real GDP increased by 2.1 per cent in 2022 and is projected to rise 0.5 per cent in 2023, according to Blue Chip Economic Indicators.

The Ministry of Finance estimates that Ontario real GDP increased 3.7 per cent in 2022, which is higher than the 2022 Ontario Economic Outlook and Fiscal Review planning assumption of 2.6 per cent. Ontario nominal GDP is estimated to have increased 9.4 per cent in 2022, slightly above the 2022 Ontario Economic Outlook and Fiscal Review planning assumption of 9.2 per cent.

Private sector forecasters, on average, project Ontario’s real GDP to rise by 0.3 percent in 2023, compared to the 2022 Ontario Economic Outlook and Fiscal Review planning assumption of 0.5 per cent. Ontario’s nominal GDP is projected to rise by 2.9 per cent in 2023, compared to the 2022 Ontario Economic Outlook and Fiscal Review planning assumption of 3.5 per cent, due largely to weaker GDP inflation expectations.

Chart 2: Comparison of Projections for GDP Growth
Accessible description of Chart 2: Comparison of Projections for GDP Growth

The future path of price inflation is a key risk to the economic outlook. In 2022, the Bank of Canada raised interest rates significantly to help reduce inflation. In recent months, inflation has begun to moderate, helped by lower energy prices. If inflation remains above the Bank of Canada’s 2 per cent target for longer than expected, the Bank may increase interest rates more than expected, which risks further negative impacts on the economy. Conversely, there is also an upside risk that inflation may moderate more quickly than expected, allowing the Bank of Canada to lower interest rates sooner than expected, which would support economic growth.

Russia’s invasion of Ukraine remains an ongoing source of global economic uncertainty and continues to impact commodity markets and global supply chains. On the other hand, the loosening of pandemic-related health restrictions in China and the subsequent increase in economic activity could help further ease global supply chain disruptions and boost global GDP growth.

Section C: Details of Ontario’s Finances

Table 4
Revenue
($ Millions)
Item2022–23
2022 Budget
2022–23
Current Outlook
2022–23
In-Year Change
Taxation Revenue — Personal Income Tax44,58450,7916,207
Taxation Revenue — Sales Tax32,28735,8583,571
Taxation Revenue — Corporations Tax19,73627,6257,889
Taxation Revenue — Education Property Tax5,6525,804152
Taxation Revenue — Employer Health Tax7,8427,738(104)
Taxation Revenue — Ontario Health Premium4,7224,663(59)
Taxation Revenue — Gasoline Tax2,0881,962(126)
Taxation Revenue — Land Transfer Tax5,6864,152(1,534)
Taxation Revenue — Tobacco Tax953851(102)
Taxation Revenue — Fuel Tax703557(146)
Taxation Revenue — Beer, Wine and Spirits Taxes635626(9)
Taxation Revenue — Electricity Payments in Lieu of Taxes51154736
Taxation Revenue — Ontario Portion of the Federal Cannabis Excise Duty21525338
Taxation Revenue — Other Taxes800670(130)
Taxation Revenue — Total126,414142,09715,683
Government of Canada — Canada Health Transfer17,56017,524(36)
Government of Canada — Canada Social Transfer6,1916,178(13)
Government of Canada — Equalization
Government of Canada — Infrastructure Programs1,2391,069(170)
Government of Canada — Labour Market Programs1,1281,128
Government of Canada — Social Housing Agreement263263
Government of Canada — Other Federal Payments4,1394,18344
Government of Canada — Direct Transfers to Broader Public Sector Organizations47949112
Government of Canada — Total30,99930,836(163)
Income from Government Business Enterprises — Liquor Control Board of Ontario2,5832,441(142)
Income from Government Business Enterprises — Ontario Power Generation Inc./Hydro One Ltd.1,1861,460274
Income from Government Business Enterprises — Ontario Lottery and Gaming Corporation2,3302,38454
Income from Government Business Enterprises — Ontario Cannabis Store18022545
Income from Government Business Enterprises — Total6,2796,510231
Other Non-Tax Revenue — Fees, Donations and Other Revenues from Hospitals, School Boards and Colleges9,36510,262897
Other Non-Tax Revenue — Vehicle and Driver Registration Fees1,0341,034
Other Non-Tax Revenue — Miscellaneous Other Non-Tax Revenue1,1691,169
Other Non-Tax Revenue — Other Fees and Licences1,2111,208(3)
Other Non-Tax Revenue — Sales and Rentals1,9391,939
Other Non-Tax Revenue — Reimbursements1,0391,039
Other Non-Tax Revenue — Royalties307307
Other Non-Tax Revenue — Power Supply Contract Recoveries42464
Other Non-Tax Revenue — Net Reduction of Power Purchase Contracts
Other Non-Tax Revenue — Total16,10617,004898
Total Revenue179,798196,44716,649

Notes: Numbers may not add due to rounding. Current outlook primarily reflects information available as of December 31, 2022, as well as other significant updates to the fiscal plan.

Source: Ontario Ministry of Finance.

Table 5
Total Expensefootnote 2
($ Millions)
Ministry Expense2022–23
2022 Budget
2022–23
Current Outlook
2022–23
In-Year Change
Agriculture, Food and Rural Affairs (Base)331.3331.3
Agriculture, Food and Rural Affairs — Demand-Driven Risk Management and Time-Limited Programs439.3439.3
Agriculture, Food and Rural Affairs — COVID‑19 Time-Limited Fundingfootnote 347.647.6
Agriculture, Food and Rural Affairs (Total)818.1818.1
Attorney General (Base)1,783.71,822.839.1
Attorney General — COVID‑19 Time-Limited Fundingfootnote 352.052.0
Attorney General (Total)1,835.71,874.839.1
Board of Internal Economy (Base)278.2278.2–  
Board of Internal Economy — Provision for Costs of General Election100.0100.0
Board of Internal Economy (Total)378.2378.2
Children, Community and Social Services (Base)18,326.518,472.8146.4
Children, Community and Social Services — COVID‑19 Time-Limited Fundingfootnote 322.023.01.0
Children, Community and Social Services (Total)18,348.518,495.8147.3
Citizenship and Multiculturalism (Base)52.650.7(1.9)
Citizenship and Multiculturalism — COVID‑19 Time-Limited Fundingfootnote 33.73.7
Citizenship and Multiculturalism (Total)56.354.4(1.9)
Colleges and Universities (Base)9,439.410,167.9728.5
Colleges and Universities — Student Financial Assistance1,333.01,241.6(91.4)
Colleges and Universities — COVID‑19 Time-Limited Fundingfootnote 310.710.7
Colleges and Universities (Total)10,783.111,420.2637.1
Economic Development, Job Creation and Trade (Base)429.8429.8
Economic Development, Job Creation and Trade — Time-Limited Investments434.4545.5111.1
Economic Development, Job Creation and Trade — COVID‑19 Time-Limited Fundingfootnote 378.096.018.0
Economic Development, Job Creation and Trade (Total)942.11,071.2129.1
Education (Base)32,439.032,441.52.5
Education — Teachers’ Pension Plan1,630.01,630.0
Education — COVID‑19 Time-Limited Fundingfootnote 3597.5968.6371.2
Education (Total)34,666.535,040.2373.7
Energy (Base)327.6327.6
Energy — Electricity Cost Relief Programs6,273.76,273.7
Energy (Total)6,601.36,601.3
Environment, Conservation and Parks (Base)711.9716.14.3
Environment, Conservation and Parks — COVID‑19 Time-Limited Fundingfootnote 324.724.7
Environment, Conservation and Parks (Total)736.6740.84.3
Executive Offices (Total)47.048.31.3
Finance (Base)938.5978.139.6
Finance — Investment Management Corporation of Ontariofootnote 4221.9221.9
Finance — Ontario Municipal Partnership Fund501.9501.9
Finance — Power Supply Contract Costs42.342.3
Finance (Total)1,704.61,744.239.6
Francophone Affairs (Base)7.47.4
Francophone Affairs — Time-Limited Investments0.60.6
Francophone Affairs (Total)7.97.9
Government and Consumer Services (Base)835.8832.8(3.0)
Government and Consumer Services — Realty1,184.51,248.664.1
Government and Consumer Services — COVID‑19 Time-Limited Fundingfootnote 389.289.2
Government and Consumer Services (Total)2,109.62,170.761.1
Health (Total)68,414.468,414.4
COVID‑19 Health Responsefootnote 54,753.64,922.3168.7
Heritage, Sport, Tourism and Culture Industries (Base)871.2906.835.6
Heritage, Sport, Tourism and Culture Industries — Ontario Cultural Media Tax Credits816.9819.22.3
Heritage, Sport, Tourism and Culture Industries — COVID‑19 Time-Limited Fundingfootnote 3200.0200.0
Heritage, Sport, Tourism and Culture Industries (Total)1,888.21,926.137.9
Indigenous Affairs (Base)118.3118.90.6
Indigenous Affairs — One-Time Investments including Settlements5,000.05,000.0
Indigenous Affairs (Total)118.35,118.95,000.6
Infrastructure (Base)981.5479.0(502.5)
Infrastructure — Federal–Provincial Infrastructure Programs717.4440.9(276.5)
Infrastructure — Waterfront Toronto Revitalization (Port Lands Flood Protection)25.025.0
Infrastructure — Municipal Infrastructure Program Investments398.4398.4
Infrastructure (Total)2,122.31,343.3(779.0)
Labour, Training and Skills Development (Base)301.7296.4(5.3)
Labour, Training and Skills Development — Training Tax Credits (Co-operative Education and Apprenticeship Training)footnote 692.092.0
Labour, Training and Skills Development — Demand-Driven Employment and Training Programs1,126.61,156.630.0
Labour, Training and Skills Development — COVID‑19 Time-Limited Fundingfootnote 3284.7469.0184.3
Labour, Training and Skills Development (Total)1,804.92,013.9209.0
Long-Term Care (Total)footnote 76,750.96,750.9
Municipal Affairs and Housing (Base)562.4562.4
Municipal Affairs and Housing — Time-Limited Investments414.5414.5
Municipal Affairs and Housing — Social Housing Agreement – Payments to Service Managers210.3210.3
Municipal Affairs and Housing — COVID‑19 Time-Limited Fundingfootnote 3127.5391.3263.8
Municipal Affairs and Housing (Total)1,314.71,578.5263.8
Northern Development, Mines, Natural Resources and Forestry (Base)1,439.41,440.31.0
Northern Development, Mines, Natural Resources and Forestry — Emergency Forest Firefighting100.0100.0
Northern Development, Mines, Natural Resources and Forestry (Total)1,539.31,540.31.0
Seniors and Accessibility (Base)203.1203.1
Seniors and Accessibility — Time-Limited Investments0.80.8
Seniors and Accessibility — COVID‑19 Time-Limited Fundingfootnote 331.140.59.4
Seniors and Accessibility (Total)235.0244.49.4
Solicitor General (Base)3,516.43,364.0(152.4)
Solicitor General — COVID‑19 Time-Limited Fundingfootnote 31.81.8
Solicitor General (Total)3,516.43,365.8(150.6)
Transportation (Base)5,888.25,888.2
Transportation — Federal–Provincial Infrastructure Programs720.7720.7
Transportation — COVID‑19 Time-Limited Fundingfootnote 3585.0585.0
Transportation (Total)7,194.07,194.0
Treasury Board Secretariat (Base)335.2335.2
Treasury Board Secretariat — Employee and Pensioner Benefits1,590.11,590.1
Treasury Board Secretariat — Operating Contingency Fund4,325.81,529.1(2,796.7)
Treasury Board Secretariat — Capital Contingency Fund224.2220.9(3.3)
Treasury Board Secretariat (Total)6,475.33,675.3(2,800.0)
Interest on Debtfootnote 813,485.013,442.0(43.0)
Total Expense198,647.7201,996.33,348.5

Notes: Numbers may not add due to rounding. Current outlook primarily reflects information available as of December 31, 2022, as well as other significant updates to the fiscal plan.

Sources: Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Table 6
Infrastructure Expenditures
($ Millions)
Sector2022–23 Current Outlook
Investment in Capital Assetsfootnote 9,footnote 10
2022–23 Current Outlook
Transfers and Other Infrastructure Expendituresfootnote 11
2022–23 Current Outlook
Total Infrastructure Expenditures
2022 Budget
Total Infrastructure Expenditures
In-Year Change
Total Infrastructure Expenditures
Transportation — Transit6,7671,4068,1738,183(9)
Transportation — Provincial Highways2,7782403,0183,018
Transportation — Other Transportation, Property and Planning14277219219
Health — Hospitals3,02233,0253,025
Health — Other Health53162215215
Education2,922152,9382,938
Postsecondary Education — Colleges and Other83749886470416
Postsecondary Education — Universities135135135
Social20299319319
Justice57034604847(243)
Other Sectorsfootnote 121,0431,4852,5283,279(751)
Total Infrastructure Expenditures18,1553,90422,05922,647(588)
Less: Other Partner Fundingfootnote 133,0213,0212,611410
Totalfootnote 1415,1343,90419,03820,035(997)

Note: Numbers may not add due to rounding.

Source: Ontario Treasury Board Secretariat.

Table 7
Five-Year Review of Selected Financial and Economic Statistics
($ Millions)
Item2018–192019–202020–21Actual
2021–22
Current Outlook
2022–23
Revenue153,700156,096164,893185,062196,447
Expense — Programs148,751152,273169,023170,453188,554
Expense — Interest on Debtfootnote 1512,38412,49512,27412,55813,442
Total Expense161,135164,768181,297183,011201,996
Reserve1,000
Surplus/(Deficit)(7,435)(8,672)(16,404)2,051(6,549)
Net Debt338,496353,332373,564380,415401,101
Accumulated Deficit216,642225,764239,294236,857247,142
Gross Domestic Product (GDP) at Market Prices860,104893,224866,981956,7071,046,883
Primary Household Income567,484593,065592,460644,263705,280
Population — July (000s)footnote 1614,30914,54514,72614,80915,109
Net Debt Per Capita (dollars)23,65724,29325,36825,68826,546
Household Income Per Capita (dollars)39,66040,77540,23243,50446,678
Net Debt as a Per Cent of Revenue220.2%226.4%226.5%205.6%204.2%
Interest on Debt as a Per Cent of Revenue8.1%8.0%7.4%6.8%6.8%
Net Debt as a Per Cent of GDP39.4%39.6%43.1%39.8%38.3%
Accumulated Deficit as a Per Cent of GDP25.2%25.3%27.6%24.8%23.6%

Note: Numbers may not add due to rounding.

Sources: Statistics Canada, Ontario Treasury Board Secretariat and Ontario Ministry of Finance.

Section D: Ontario’s 2022–23 Borrowing Program

Table 8
Ontario’s 2022–23 Borrowing Program
($ Billions)
Item2022–23
2022 Budget
2022–23
Current Outlook
2022–23
Change from 2022 Budget
Deficit/(Surplus)19.96.5(13.3)
Investment in Capital Assets13.413.3(0.2)
Non-Cash Adjustments(9.7)(17.7)(8.0)
Loans to Infrastructure Ontario(0.1)(0.2)(0.1)
Other Net Loans/Investments0.70.0(0.7)
Debt Maturities/Redemptions30.530.60.0
Total Funding Requirement54.732.5(22.2)
Decrease/(Increase) in Short-Term Borrowing(3.0)3.0
Increase/(Decrease) in Cash and Cash Equivalents
Pre-Borrowing in 2021–22 for 2022–23(10.3)(10.3)
Pre-Borrowing for 2023–249.99.9
Total Long-Term Public Borrowing41.532.2(9.3)

Note: Numbers may not add due to rounding.

Source: Ontario Financing Authority.

Ontario’s current funding requirements for 2022–23 are projected to decrease by $22.2 billion compared to the forecast in the 2022 Budget, reflecting stronger financial results reported in the Public Accounts of Ontario 2021–22 and a decrease in the projected deficit for 2022–23. The funding requirements are down $6.9 billion, compared to the forecast in the 2022 Economic Outlook and Fiscal Review.

The province’s long-term borrowing program for 2022–23 is forecast to remain unchanged from the forecast in the 2022 Ontario Economic Outlook and Fiscal Review, reflecting additional pre-borrowing of $6.9 billion for the next fiscal year, for a total of $9.9 billion. The province’s total long-term borrowing program is $9.3 billion lower than forecast in the 2022 Budget. Short-term borrowing for the fiscal year is projected to remain unchanged since the release of the 2022 Economic Outlook and Fiscal Review.

As of February 7, 2023, Ontario had completed $29.9 billion or 93 per cent of its $32.2 billion 2022–23 long‑term borrowing program. Approximately $26.2 billion or 88 per cent was completed in Canadian dollars, with the remaining $3.7 billion or 12 per cent completed primarily in U.S. dollars.

Green Bonds remain a core component of Ontario’s borrowing program and are an important tool to help finance public transit initiatives, extreme weather resistant infrastructure, as well as energy efficiency and conservation projects. Ontario remains the largest issuer of Canadian dollar Green Bonds, totalling $13.5 billion issued since 2014–15, with $13.0 billion outstanding. Subject to market conditions, Ontario plans to continue issuing multiple Green Bonds each fiscal year, including in 2022–23.

Ontario is updating its Green Bond Framework. The update will include better alignment of framework categories with the Green Bond Principles through standardized wording, as well as the expansion from green to sustainable to allow for a greater breadth of potential bond offerings in the future.

Interest rates have risen by more than projected in the 2022 Budget, resulting in an increase of Ontario’s cost of borrowing for 2022–23 to 4.0 per cent from 3.4 per cent projected in the 2022 Budget, but down from the 4.2 per cent forecast in the 2022 Economic Outlook and Fiscal Review. In spite of the higher interest rates, interest on debt is forecast to decline to $13.4 billion from the $13.5 billion forecast in the 2022 Budget as a result of lower deficits and the borrowing program. Ontario will continue to monitor movements in long-term interest rates and provide regular updates on interest on debt costs in future fiscal updates.

2022–23 Long-Term Borrowing

Table 9
2022–23 Long-Term Borrowing
($ Billions)
ItemAmount
Canadian Dollar Issues26.2
Foreign Currency Issues3.7
Total29.9

Note: Numbers may not add due to rounding.

Source: Ontario Financing Authority.

Ministry of Finance: www.ontario.ca/finance
For general inquiries regarding the 2022–23 Third Quarter Finances, please call or email:
Toll-free English and French inquiries: 1-800-337-7222
Teletypewriter (TTY): 1-800-263-7776
Email: FinanceCommunications.fin@ontario.ca

© King’s Printer for Ontario, 2023

Chart Descriptions: Alternative Text for Web Accessibility

Chart 1: Ontario Employment Gains in 2022

This bar chart illustrates Ontario’s annual employment gains in 2022. Changes are as follows: Total employment was 338,300 higher; Full-time employment was 283,500 higher; Part-time employment was 54,800 higher; Private-sector employment was 250,800 higher; Public-sector employment was 86,600 higher; Self-employment was 900 higher; Goods producing industry employment was 77,300 higher; and service producing industry employment was 261,000 higher.

Source: Statistics Canada.

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Chart 2: Comparison of Projections for GDP Growth

The stacked bar graph illustrates the 2022 Ontario Economic Outlook and Fiscal Review planning projections and the 2022–23 Third Quarter Finances estimate for Ontario nominal GDP growth, real GDP growth and GDP inflation rates for 2022, and the 2022 Ontario Economic Outlook and Fiscal Review planning projections and 2022–23 Third Quarter Finances private-sector averages for Ontario nominal GDP growth, real GDP growth and GDP inflation rates for 2023.

The 2022 Ontario Economic Outlook and Fiscal Review planning projections for Ontario real GDP growth are 2.6 per cent for 2022 and 0.5 per cent for 2023. The 2022 Ontario Economic Outlook and Fiscal Review planning projections for Ontario nominal GDP growth are 9.2 per cent for 2022 and 3.5 per cent for 2023.

The 2022–23 Third Quarter Finances estimate for Ontario real GDP growth is 3.7 per cent for 2022, while the 2022–23 Third Quarter Finances private-sector average for Ontario real GDP is 0.3 per cent for 2023. The 2022–23 Third Quarter Finances estimate for Ontario nominal GDP growth is 9.4 per cent for 2022, while the 2022–23 Third Quarter Finances private-sector average for Ontario nominal GDP growth is 2.9 per cent for 2023.

Source: Ontario Ministry of Finance, based on information available as of January 30, 2023.

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