Privatization of public asset wastes billions
TORONTO, Feb. 13, 2018 /CNW/ - The Financial Accountability Office's (FAO) updated analysis of the Ontario government's sell-off of Hydro One regrettably confirms our worst fears, says AMAPCEO, a union representing over 14,000 professional workers in the Ontario Public Service and six broader public sector agencies.
"From the beginning of this folly, it was clear to many observers that the government was willing to forego sustainable revenues to receive a short-term boost to its finances," said President Dave Bulmer. "Ontario's hardworking professional employees sounded the alarm on this ages ago."
The government's disappointing lack of foresight is confirmed by the FAO (an independent office of the Legislature), which finds that while the province's annual surplus / deficit will improve by $3.8 billion over the past and current fiscal year, the forecast deteriorates each year from fiscal year 2018-19 and beyond. This negative financial outcome is a result of the province losing out on much of Hydro One's future net income and by the end of Hydro One's payments-in-lieu of taxes (although Hydro One will not pay corporate tax, the predicted taxation revenue is an amount well below what was yielded in the past through the payments-in-lieu).
If all of that is not bad enough, the FAO went on to find that, starting in 2028-29, the provincial debt would be lower if, instead of privatizing Hydro One, the government had simply borrowed the money for the infrastructure projects that were meant to be funded through the Hydro One sell-off.
"This will mean billions less for the quality public services that Ontarians rely on," said Bulmer. "On the heels of the Carillion fiasco, it is yet more evidence that privatization schemes are the wrong path forward."
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