Commission on the Reform of Ontario's Public Services

Over the past decade, the Ontario government has made significant investments in programs
and services across Ontario to help newcomers settle, get language training, and become
job-ready and licensed in their field. These should be integrated with complementary services
already offered through EO, and carried out carefully, to ensure no drop in service quality
during the transition.
The first federal–Ontario immigration agreement in 2005 provided new funds to help
newcomers settle and improve their language skills. But the federal government has not kept
its commitment to spend all the funding allocated to Ontario; to date, the federal government
has underspent its commitment by over $220 million. Ontario should push for greater policy
control and full funding support for immigrant settlement and integration through the next
Canada–Ontario Immigration Agreement. Ontario should build a business case for devolving
federal immigrant settlement and training programs to the province with an appropriate funding
mechanism, similar to those established in British Columbia, Manitoba and Quebec.
Business Supports
The government should rethink and reset its business support programs. At a time when
the economy faces significant challenges, Ontario has two critically important assets that
support economic growth: one of the most highly skilled workforces in the world and an
internationally competitive tax regime. Recent tax reforms alone have saved business more
than $8 billion in annual taxes.
Ontario has myriad programs to support business investment. In the latest year, the
government spent just over $1.3 billion directly to help businesses through 44 programs
across nine ministries and provided another $2.3 billion of indirect support through tax
expenditures, including tax credits that were introduced when corporate income tax (CIT) rates
were high, but retained even after CIT rates fell significantly. Empirical evidence suggests that
business subsidies have done little to raise living standards and can distort business decisions
to the point where they are no longer based on sound economic criteria or require a
reasonable degree of private risk.
Ontario’s hodgepodge of direct and indirect programs is fragmented and lacks clear and
coherent objectives. As data on outcomes are often poor and inconsistent, it is unclear
whether the programs are achieving any economic benefits for Ontario. If we were to design
business support programs from scratch, they would not look like what we have now.
We can either restructure the existing programs or start over. The second option is the
better way forward.
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