(Queen’s Park,Toronto) – Today, MPP Jeff Yurek asked Finance Minister Dwight Duncan to explain why he continues to insist thatOntario’s finances are stable given the fact that when converted to a stack of $100 bills, the deficit would create a tower 29 times the height of the CN Tower.
“If you did build a tower out of $100 bills, at least the Ontario people would have something to show for the billions of dollars you continue to waste every year,” remarked Yurek to Duncan.
The question was in response to Duncan downplaying the financial indictments two separate credit rating agencies issued last week. S&P revised its outlook on Ontario’s debt to negative from stable. A spokesperson for the agency warned there is now a one in three chance S&P will downgrade the debt rating. One day after S&P’s sobering review, Moody’s did issue an outright downgrade on Ontario’s debt.
“A debt downgrade has huge implications,” said Yurek, “when our debt is deemed riskier, investors demand higher interest rates to lend their money. Every 1% increase in interest rates results in $500 million in additional interest costs the Ontario government must incur. That money could instead be used to hire 12,000 first year elementary school teachers, 8,700 first year nurses, or conduct 250,000 MRI exams.”
Despite doubling the province’s debt in eight years, Duncan continues to insist that responsibility for Ontario’s fiscal position lies everywhere but the Liberal caucus.
All of Duncan’s budget assumptions and targets must be hit in order to achieve balance by 2017. One of those major targets requires the Liberals to negotiate a zero per cent increase in public sector compensation. However, in 2010, McGuinty reneged on a promise to do just that and public sector compensation grew by 1.8% and outpaced inflation.
“The McGuinty government has no credibility in this matter. Theirs is a record of saying one thing and doing another so I doubt very much that they have the ability reduce the height of the deficit tower they have built.”
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