Liberals to do more to curb spending, Sousa says

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Armed with a majority, the Liberals will do more to control spending and balance the budget now that they no longer have to deal with the non-stop drama of a hung parliament, says Finance Minister Charles Sousa.

His comments came after delivering a prebudget speech at the Empire Club at the Royal York Hotel. On Monday, Mr. Sousa is reintroducing the budget, whose failure to pass the previous legislature in April triggered last month's election. The ambitious document includes $29-billion for transit and transportation, billions in grants for business, and the groundwork for a new provincial pension plan.

"Having a majority mandate now gives us a little bit more initiative to implement things and expedite them more quickly," he said Thursday. "That stability in the government plays not only to [credit] rating agencies but to investors as well."

The big-spending budget caused consternation for bond raters Moody's, who changed their outlook on Ontario to "negative" last week, contending the province has not shown enough progress on its plan to erase the $12.5-billion deficit in three years. But Mr. Sousa sounded nonplussed.

"I know the agencies … have expressed concern about our determination to meet those targets," he said in his address. "I accept that. It's their job. And it's my job and that of our government to deliver on our plan."

He promised to sell off real estate and other assets, as well as make structural reforms to programs to save money. The Liberals are also hiking income taxes on the rich to bring in more cash. Such things will be easier now that the government controls the legislature.

The NDP, on whose support the Liberals depended to govern in the last parliament, is generally against selling public assets. New Democrat MPP Catherine Fife argued it would be more valuable in the long run for the government to hold onto real estate and rent it: "It's hugely concerning – it's a one-time win."

The Progressive Conservatives, meanwhile, accused the Liberals of whistling past the fiscal graveyard. "They've had plenty of opportunity to change their ways and instead we see them increasing taxes and increasing the deficit at the same time," finance critic Vic Fedeli said.

But the confidence of a parliamentary majority seemed to animate Mr. Sousa, who took a breezy tone in his speech. Outlining the government's plan to build more public transit, he joked about his own commute from his suburban home to the legislature.

"I've suffered from something I like to call 'acute traffic congestion.' It hurts. It's an unpleasant condition that keeps you away from your family," he said.

While laying out optimistic economic growth forecasts for Ontario, Mr. Sousa singled out a group of civil servants from the Finance Department in the audience. He exhorted the bureaucrats – known for their dire warnings about the state of the province's books – to cheer up.

"Come on, guys," he said. "Take those happy pills."