As we prepare for the Ontario government to announce its newly elected Cabinet, there is a great deal of anticipation for what Doug Ford’s second term as Premier will hold on the policy front. While Premier Ford’s first term can hardly be described as lacking in activity, the current Progressive Conservative (PC) government is in a stronger position to reform government and “Get it Done” than during the last mandate. The PCs return to government with a stronger majority of 83 seats, compared to 76 seats in 2018, and received a slight bump in their share of the popular vote with 40.8 per cent, up from 40.5 per cent in 2018.
The Ford government’s efforts to make significant changes during their first mandate were interrupted by the all-consuming COVID-19 pandemic, which required an all-hands-on deck focus, and exposed the (already showing) cracks in the healthcare system. We expect the newly re-elected government to have a short honeymoon period and start moving quickly to address key files and issues over the summer and into the fall.
Based on the narrative we saw during the election, here are top five priorities we expect the Ford government to focus its attention on as it reforms government and for the next four years.
Housing & Affordability
If there was a defining issue of the recent election, this is surely it. Ontarians are feeling the pinch as inflation eats into earnings and they continue to be priced out of housing in their preferred communities (or out of the entire market). During the election campaign, the Premier committed to implementing the recommendations from the Housing Affordability Task Force, particularly the goal of building 1.5 million new homes over the next 10 years. Achieving this goal will likely require some centralization of zoning or housing approvals (for example, the task force recommended scrapping exclusionary zoning). Yet, the Ford government often deferred to municipal leaders in its first term – one of the reasons why the housing affordability legislation introduced and passed before the election was less ambitious than many had hoped.
More legislation to address housing affordability and implement some of the task force report recommendations will be forthcoming (likely to be a regular or annual feature of the second term). How quickly this legislation is introduced and implemented will be telling. Similarly, how much the Ford government is willing to confront municipal leaders on this file – especially with municipal elections, where housing will likely again be a top issue, happening in late October - is an open question.
To a certain extent, the other affordability issues will somewhat help the Premier, as rising interest rates to stem inflation are increasing mortgage costs and tempering the increases in housing prices.
Energy & Electricity Supply
While energy issues did not feature as significantly in the election campaign as they have in elections past, electricity’s role as an enabler of economic development in terms of its accessibility, reliability, affordability, being a critical catalyst for emissions reduction, and the plan for addressing looming supply needs are poised to grow in prominence in the months ahead. The Independent Electricity System Operator (IESO) has been forecasting for some time that Ontario is approaching a period of electricity supply scarcity that necessitates the need for a period of meaningful investment in new infrastructure for the first time in several years.
To meet those needs, the IESO is advancing a variety of procurement streams to secure the necessary resources to maintain reliability, with an emphasis on capacity products that will be available following the scheduled retirement of the Pickering Nuclear Generating Station in 2025. The province’s approach is multi-faceted and includes various competitively-bid and bilateral arrangements; examining new hydroelectric potential; incremental nuclear including small modular reactors (SMRs); hybrids and stand-alone energy storage (including pumped storage); and potential expansions to existing facilities. Hydrogen and carbon capture and storage (CCS), greater focus on energy efficiency, as well as distributed energy resources (DERs) and smart grid innovations, are also on the government’s agenda.
The appointment of a new Cabinet and the decision of who will be Ontario's Minister of Energy in the coming weeks will assist to determine the government's goals and what the sector may expect over the next four years. Unquestionably, Ontario is on the cusp of a transformative period when it comes to its energy sector – who does what, what types of electricity resources do we need, and what outcomes are we prioritizing will be important themes over the next four years.
Healthcare
The pandemic created a huge surgical backlog. Reducing this backlog has been a challenge due to decaying hospital infrastructure and health human resources challenges. Prior to the election, the Ford government committed to investing $40 billion over the next 10 years to build and improve hospital and healthcare infrastructure. During this next mandate, we expect the implementation of the funding already committed, as well as the announcement of additional funding for new projects.
While building hospitals and funding beds is part of the solution, this alone will not alleviate the current problems if we do not increase health human resources to provide care for the patients. Several policies and programs have been announced to date to address the health human resources constraints, specifically increasing medical school seats and residency spots, and expanding funding for those wishing to study nursing, but they will take years to implement and have an impact on the system. We expect this government will continue to develop policy and programs to address these issues, including revisiting the wage cap for nurses. The government will likely be open to creative solutions from stakeholders that will address the current deficits and backlogs within the healthcare system and we expect a newly appointed Minister of Health will hit the ground running, and fast.
Infrastructure & Transit
The Ford government made significant funding announcements for transit and infrastructure in their last mandate and the 2022 Budget, which was released but not passed before the election. In fact, “building highways and key infrastructure” was a pillar in the proposed Budget document aimed at addressing gridlock, building roads and highways, and improving public transit in and out of the Greater Toronto Area (GTA). This quickly transitioned to be a main pillar of the party’s re-election campaign with $25 billion of investment over the next 10 years to build roadway infrastructure including the contentious Highway 413 and the Bradford Bypass. Other projects announced in the proposed Budget and campaigned on during the election include moving forward on the widening of Highway 402 east of Pickering and the QEW Garden City Skyway rehabilitation project. On the public transit side, the PCs focused on spending $61 billion over 10 years to build the Ontario Line and the Eglinton Crosstown West Extension, which will connect to Pearson International Airport, and advancing planning work on the Sheppard Subway Extension connecting to the existing Don Mills Station.
We can expect to see the Ford government continue in its tracks of investing and building more roads, highways, and transit infrastructure in the next four years to create a more integrated commute system for Ontarians. The leadership that will move these files forward will become clear in the coming weeks as the Premier announces his new Cabinet members, but we can expect to see the Ministers of Infrastructure and Transportation working closely together on major projects to ensure continuity and timely completion of projects.
Red Tape & Efficiencies
In its last mandate, the Ford government committed and stuck to introducing a Red Tape Reduction bill twice a year (one in the spring before the Budget and one in the fall before the Fall Economic Statement) to reduce burdensome regulations and to improve economic competitiveness. An Associate Minister role within the Ministry of Economic Development, Job Creation and Trade was also created to help drive this agenda. We expect this new government will continue the tradition of bi-annual regulatory modernization packages. In the future, we also expect the government to expand the target of the red tape reduction to improve service delivery for citizens by reducing regulatory and administrative burdens. Premier Ford has also recently started mentioning the need to implement Lean Six Sigma processes within government to help find efficiencies by removing waste, reducing variation, and improving workflow.
What’s Next
In the coming days we expect the Premier to announce his Cabinet. While the Legislature is currently scheduled to return on September 12, it is highly likely that we could see the Legislature recalled for a short summer sitting to re-introduce and pass the legislation implementing the 2022 Budget. Premier Ford has indicated that the Budget will be virtually the same as that previously introduced in April with a few tweaks. We expect the government and newly named Cabinet will stay on message and address the priorities as identified in the Budget.
As with any government, especially one where the public has high expectations and where there are difficult issues to tackle, there will likely be controversies or fires that arise. The government will need to be prepared to address these issues head on. The pandemic presented unique challenges and forced the Ford government to change, abandon or delay certain priorities. Given the global environment and its external pressures, it is unlikely the second term will be complete smooth sailing. But the Ford government’s increased majority should ensure it traverses any waters they choose, no matter how choppy they may get.
This is the time where organizations should lay the foundation for engagement with a new government and hit the ground running. Please contact your Sussex consultant should you have any questions about the election results, government priorities and what this means for you.
Brian Zeiler-Kligman, Vice President, Ontario Government Relations: bz-k@sussex-strategy.com
Sadaf Abbasi, Director, Ontario Government Relations: sabbasi@sussex-strategy.com
Naomi Shuman, Associate, Ontario Government Relations: nshuman@sussex-strategy.com
Kristina Matovich, Research Associate, Energy: kmatovich@sussex-strategy.com
