Comment 123114

By ASmith (registered) | Posted June 23, 2018 at 11:11:14 in reply to Comment 123088

the government no longer collects enough revenue to pay for essential public services

Provincial revenue in Ontario grew by 5.2% between 2003-17.

If we assume that inflation averages 2% and real growth of 3.2% is historically high, how is it possible the Libs couldn't balance the books over this period?

The goal in govt is not to just spend, it's to spend wisely so that services can be delivered at the lowest possible cost to taxpayers. This requires a focus on productivity.

So let's look at some numbers...In 2003, there were approximately 2M public school students in Ontario. By 2010, it was down to 1.9M. (http://www.hwdsb.on.ca/secondaryarc/files/2011/01/Item5-MinistryofEducation_Enrolment-Trends-2002-2014.pdf). However, in this same time period, provincial education spending jumped from $14.8B to $21.4B. Per student spending increased by 6.2%.

The good news is, graduation rates increased from 68% in 2004, to 81% in 2010. However, the primary goal of education spending is to make the economy more productive and thus boost economic growth. How did the spending increases between 2003-10 help Ontario's economy? Well, between 2003-17, Ontario's labour productivity ( Table: 36-10-0480-01 (formerly CANSIM 383-0033) averaged 0.97%. In contrast, between 1996-2003, the dreaded Harris years, worker productivity averaged about 1.6%.

Politicians can make claims about how important their "investments" are, but in the real world, people make investments to increase wealth. Higher grad rates means nothing if the economy is less productive and taxes/debt higher. That's a terrible trade off.

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