The tragic denouement of a once great province

January 9, 2015

Premier Kathleen Wynne is driving Ontario and its muncipalities into the ditch by introducing costly programs including this year, a 10 per cent increase in Hydro rates.

All this on the back of spending $1.9 billion on smart meters that have failed to reduce consumption of electricity as planned instead, it has sharply introduced higher rates around the province.

One of the causes is the clumsy way the McGuinty Liberal government introduced wind-powered generation that has tied the costs of this form of power for 20 years at rates far exceeding that of traditional nuclear and water power.

Just driving around southern Ontario you can see the hundreds of windmills generating power. Trouble is it is high cost generation and there is too much of it. There is no way that this excess costly generation can be stored so it is sold to U.S. adjoining states at below cost.

The winners are those private companies that built these wind farms because the provincial government made long term, costly contracts as an inducment. Then add the billion dollars spent to demobilize the two partially constructed gas-fired generation plants in Oakville and Mississauga.

The ongoing OPP investigation into whether this action was the result of political determination to save four Liberal seats in the 2010 provincial election, has yet to be concluded. The files pertaining to this event were removed from the computers in the Premier’s office.

The ten-year record of managing power generation in Ontario is a mismanaged financial disaster that has made the province uncompetitive and created the highest cost of power in North America.

It has led to the destruction of the manufacturing sector in the province. Many rural and even larger communicties, in Ontario, are facing financial disaster as residents can no longer pay the ever-increasing property tax rates. It has divided the private and public sector where public employees are working with guaranteed jobs and benefits that private sector employees cannot match.

The loss of manufacturing jobs is endemic throughout Ontario. Young people in the smaller communities are migrating to the big cities for jobs. This leaves an aging population that struggles to pay the ever-growing tax increases, higher utility charges. Three small cities come to mind, North Bay, Windsor and Timmins where there is a growing net decline in population.

This a growing social problem created by the Liberal governments in Ontario. Excessive spending on power generation, full time kindegarten and public employee union contracts, has resulted in an ongoing annual cash deficit of more than $12 billion. This must be borrowed and financed. At an average loan rate of 3 per cent, the annual interest cost is $360,000,000 before any principal is paid.

At that rate, Ontario Finance Minister Charles De Sousa will be long gone before that deficit disappears. He is predicting the deficit will disappear by 2017, the year before the next provincial election.

With the province struggling to rebuild its manufacturing base, there is little opportunity to create revenue to shut down the huge deficit. If you are Ford or Honda, you squeeze money to expand production facilities. If you are the chief financial officer in hundreds of stressed communities, good luck.

Guelph has recently experienced a direct consequence of excessive spending by the former administration over eight years. The result is a city with high costs, a stagnant industrial and commercial assessment base and that means the residential sector bears the weight of exacerbating financial mismanagement.

The Ontario premier must bear responsibility for this growing problem. The honeymood (sic) is over and the time has come to reduce costs across the board, introduce incentives to grow the economy and jobs and meet the reality of a province in serious decline.

There are 444 municpalities in Ontario that need a change of attitude at Queen’s Park.

The buck stops at the Liberal benches in the Legislative Assembly.

 

 

 

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