What you need to know
What we provide
The provincial government provides public goods and services, many of which are critical to building strong, healthy communities and a sustainable economy.
For example, the government provides:
health care
education
social services
infrastructure
These public goods and services cost money. Costs are all factored into the provincial budget, our financial roadmap for the year. The budget typically outlines:
- what we plan to spend in the upcoming year, including for new programs or initiatives we plan to launch
- what we expect to receive in taxes and other sources of revenue
- how we plan to manage our deficit and debt burden
- a detailed outlook on the economy
Learn about ministries’ spending in 2017-18
About deficit and debt
Deficit
When the government’s expenses are higher than its revenue, the result is called a deficit.
To protect important services like health care and education, the government borrows funds to cover this gap and pays it back with interest over time.
Ontario’s deficit is projected to be $11.7 billion in 2018-19.
Debt
When a deficit adds up from one year to the next, it becomes part of the provincial debt.
The debt represents the amount of money the government has borrowed from the general public and institutional investors, such as pension funds, insurance companies and banks.
At the end of 2018-19, the province owed a projected $343 billion in debt, higher than any other subnational government in the world.
$11,700,000,000 deficit
$343,000,000,000 debt
How we got here
When the government spends more than it takes in, it results in a deficit, which increases the debt. Over the last decade alone, Ontario’s net debt has more than doubled — growing from about $160 billion to more than $343 billion.
If the government is in deficit, each new program or tax cut can add to the debt.
Other factors can also affect the government’s debt and deficit, including:
- interest rates
- economic growth
- how the government accounts for unexpected expenses, such as those caused by natural disasters
- federal and global economic trends
Learn more about our deficit and debt in the 2019 Budget.
Why it matters
Interest payments on our debt are Ontario’s fourth largest line item after healthcare, education and social services.
In 2019–20, interest on the debt will cost about $13.3 billion.
As Ontario’s debt has increased, we continue to pay more and more interest. Every dollar that is spent paying interest is one less dollar going to critical public programs and services.
Ontario’s top expenses
Health sector
$63.5 billion
Education sector
$41.2 billion
Children and social services sector
$16.7 billion
Interest on debt
$13.3 billion
Ontario’s plan
We have taken early actions to limit unnecessary expenses and identify savings. For example, we:
- froze hiring, with the exception of essential front‐line services
- froze discretionary spending
- cancelled subscription‐based services
- restricted travel, meals and hospitality spending
- launched an Audit and Accountability Committee to conduct audits of the province’s ministries, agencies and transfer-payment partners and ensure resources are properly used
Restoring balance and reducing the debt burden will improve Ontario’s fiscal health and help ensure Ontario’s hospitals, schools and other critical public services have the sustainable funding they need for now and generations to come.
We have a plan that will:
- build a fiscally sustainable government
- protect critical public services
- restore trust, transparency and accountability
- put Ontario on a path to balance the budget in a responsible way by 2023-24
- reduce the debt burden
As part of the debt burden reduction strategy, we will:
- strengthen legislation, eliminate loopholes and ensure compliance with the law
- actively pursue a debt burden reduction approach to public finance
- enhance reporting on debt sustainability and affordability
Learn more about our plan to balance the budget and reduce the debt burden.