As we continue to grow, and embrace our Bold Attitude and Entrepreneurial Spirit, we are thrilled to announce that Optimus SBR has been named one of the 2019 50 Best Workplaces in Canada, for businesses of 100-999 employees.

 “We’re so excited to be recognized as one of the Best Workplaces in Canada. Our people have made such strong contributions to developing and nurturing the culture of our firm, and being included on this list reaffirms that our vision of building a different kind of consulting firm is working”  shares Kevin Gauci, CEO.

The 2019 Best Workplaces™ in Canada list is compiled by the Great Place to Work® Institute.  The competition process is based on two criteria: two-thirds of the total score comes from confidential employee survey results and the remaining one-third comes from an in-depth review of the organization’s culture. This offers a rigorous representation of the organization from an employee perspective, and an overall portrait of the workplace culture. Together, they provide crucial data relative to five trust-building dimensions: credibility, respect, fairness, pride, and camaraderie.

This year’s list received over 400 registrations and over 80,000 employees participated in the 2019 “Best Workplaces™ in Canada” survey, rolling out to impact over 300,000 Canadian employees. We ranked 27th in our inaugural year on the list.

The 2019 list was published as a Special National Report in The Globe and Mail on April 26, 2019, and online at www.greatplacetowork.ca.

Doing Things a Bit Differently

Optimus SBR’s Industries and Government Practice regularly monitors policy developments at the federal, provincial and municipal level to inform and support its work with government and broader public sector/publicly funded organizations, as well as those in the not-for-profit and private sectors. In November, we described in our Counting Every Dollar briefing note how the Ontario government signaled priorities in its fall economic statement. This Briefing Note highlights key elements of interest to our clients from yesterday’s Ontario Budget announcement.

There were no great surprises, as the government announced many of the items in the Budget ahead of its release, perhaps to a greater extent than previous governments. What is possibly surprising is that, with the exception of a couple of major sectors, there are few deep cuts in this budget. The Ontario Public Service (OPS) is indeed shrinking – already reduced 3.5% through attrition – but, as the government has emphasized, most provincial spending takes place beyond the walls of OPS functions. Relative to what the government’s critics might have expected, this is a moderate, directional budget focused on controlling spending. A balanced budget isn’t expected until what would be this government’s second term in office.

“Protecting What Matters Most”

The 2019 Ontario Budget, subtitled “Protecting What Matters Most”,[1] opens with a statement of the government’s five core priorities:

It echoes some of the “Every Dollar Counts” language from the fall economic statement in a few places, and also emphasizes this philosophy in other ways. For instance, there is a callout early in the document for “Ending March Madness”, which describes how the government announced on February 13th that all ministries were to limit their spending to commitments under contract, legislation and/or requirements to fulfill core services through the end of the fiscal year. It also notes that “Additional scrutiny will continue to be applied to discretionary spending to ensure that taxpayers are respected throughout the entire fiscal year.” It continues to set a tone.

Choice and convenience for Ontario individuals, families, and businesses are also emphasized with references to the government’s digital-first strategy, the auto insurance system, electricity bill relief, and transit and transportation, including the government’s newly announced subway plans.

The Path to Balance and a Reduced Net Debt-to-GDP Ratio

The Budget shows a projected deficit of $10.3 billion for fiscal 2019-20 and describes a recovery plan to achieve a balanced budget in 2023-24 and, more importantly, reduce the net debt-to-GDP ratio to 38.6% by that time as well. As noted above, this is likely a more moderate path towards deficit and debt reduction than many had anticipated.

How much?

For fiscal year 2019-20, the government is planning to spend $163.4 billion, which includes:

One way of looking at how spending in these sectors will play out is in the figure below, which puts forecast spending levels in terms of the 2018-19 Interim projection (i.e., this year’s spending) for each sector. Health and Education will increase as is typically the case, but spending in the Children’s and Social Services and Justice sectors will decrease from today’s levels. Postsecondary spending will decrease in the next year, but then increase thereafter (with a large change in funding approach – see more below). Below we highlight some key areas where the government is directing its attention and fiscal focus for this and future years.

Highlights by Sector

Corporate, Industrial and Small Business Sectors

As often signaled, the government is working to make the province more “Open for Business” than it has been previously. The Budget discusses a range of measures, such as the Ontario Job Creation Investment Incentive (which includes immediate write-offs of different types of equipment), maintaining small business corporate income tax reliefs, reducing WSIB premiums, the government’s 10-year Driving Prosperity Plan for the auto sector, and an emphasis on reducing regulatory burdens and red tape. The government is also committing to review industrial electricity pricing through targeted stakeholder consultations on industrial electricity pricing as well as a review of existing pricing programs. How these apply to individual industries and businesses will surely depend on their circumstances, but this focus continues to be central to the government’s priorities.

Transit and Transportation

There is much commentary on transit in the Budget, including discussions of expansions to GO Transit service, the upload of the Toronto Transit Commission (TTC), and the province’s new transit plan for Toronto and the Greater Toronto Hamilton Area, which was described as “…the single largest capital contribution to new subway builds and extensions in Ontario’s history.” It describes the four projects proposed for the City of Toronto – the new “Ontario Line”, Yonge North Subway Extension, Scarborough Subway Extension, and Eglinton Crosstown West Extension – with a preliminary cost of $28.5 billion. Additional highlights include:

At this stage, exactly how the Ontario government will secure cooperation and funding from the federal and municipal levels of government for its major projects is not yet clear, so there remains uncertainty as to whether, how, and when these plans will get executed.

Health

At a system level, the Budget reiterates some of the recent announcements coming from Bill 74, including the planned creation of the Ontario Health agency (for more on this, see our briefing note on The Changing Ontario Health Care Landscape), and recently released guidance on Ontario Health Teams. This is the first time the government has quantified the anticipated savings from Ontario Health, estimated at $350 million annually once the agency is at maturity. Other system-level initiatives include:

Commitments for specific health sectors include:

Energy

What may be a surprise to some is that relatively little is said about the Energy sector. The section on Lowering the Cost of Energy echoes some previous announcements for the sector. Reference is made to consultations on industrial electricity pricing to inform the design of new policies, and there is discussion elsewhere in the document of modernizing the Ontario Energy Board. Given that this remains a priority sector for the government, we will have to wait to hear more and/or monitor other legislative developments to see what will happen in the sector.

Education

Commitments in the Education sector include:

In postsecondary education, the government has committed to a 10% reduction in tuition for publicly-funded colleges and universities for the 2019-20 school year, and a tuition freeze for 2020-21. Most strikingly, it describes a new approach to funding Ontario’s publicly-assisted postsecondary institutions, including 45 colleges and universities. The government proposes to become a national leader in outcomes-based funding in this sector, moving from a system in which just over one per cent of funding is tied to performance to one in which 60% of funding is tied to performance by 2024-25.

Children and Social Services

As noted above, this sector is expected to see a decrease in funding over time. Commitments here include:

Municipalities

Commitments to municipalities include:

Discussion: Doing Things a Bit Differently

There is of course much more in the Budget. In some respects, it takes on a familiar form – deficits followed by a plan to get the budget balanced and net debt-to-GDP ratio down over the medium term, as well as anticipated increases in spending in health care, education, and infrastructure. In others it represents a major departure from past governments – for instance, in its tone, focus on reducing burdens for businesses, the expected spending changes in some sectors, and the new approach to postsecondary funding. So this new government is doing things a bit differently. As ever, execution on some of these initiatives and commitments will be harder than others, and much will depend on what happens with the Ontario economy in the next 18-24 months.

Optimus SBR’s Industries and Government Practice

Optimus SBR is an implementation-focused firm that specializes in turning policy into action. Our Industries and Government Practice has extensive expertise in policy, governance, strategy, stakeholder consultation and facilitation, organizational effectiveness, and a range of implementation services from planning and project management to process improvement. If you have found this helpful, give us a call, or send us a note.  

Terri Lohnes, Senior Vice President and Practice Lead
Terri.Lohnes[@]optimussbr.com
416.649.6017

David Lynch, Principal
David.Lynch[@]optimussbr.com
416.723.3284

Jason Huehn, Manager
Jason.Huehn[@]optimussbr.com
416.649.6021

[1] Excerpts in bulleted form below preserve or paraphrase the Ontario Budget wording to ensure accuracy and clarity.

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