The Liberal Plan for Prosperity

Today I want to outline for you some of the key things that a Liberal government would do to restore Ontario's position as one of the leading economies in North America and what we would do to turn a fragile and unpredictable recovery into a strong and sustained period of prosperity in which everyone can benefit. I also want to talk to you about the role of government in creating a climate for growth. Because now, more than ever, Ontario needs a government that understands when to act to create opportunity, and when to get out of the way and let opportunity flourish on its own.

Let me be forthright from the outset. I have not come bearing any magic solutions or miracle cures. There are no quick fixes for dealing with Ontario's problems or meeting our challenges. Government in the 90s isn't about gimmicks involving spending or simplistic cuts. It's about dealing with real problems in realistic ways.

One of those realities is that the current government will pass on a debt of more than $90 billion to whichever party forms the next government. That will place limitations on what any government can spend. But it will also force government to remove the limitations on its imagination and creativity. That's something that is long overdue.

Before I talk about the future, let me say a few words about the past. Ontario has been through some tough times in the last four years. In many communities the difficulties continue.

Today in this province there are half-a-million workers unemployed--over 200,000 in Metro Toronto alone. More than 1.3 million people rely on welfare; hundreds of thousands of them are in this community.

Bob Rae and his NDP policies didn't cause the global recession. But look at the enormous damage they did cause in this province. In Ontario and in Metro, the recession hit harder, cut deeper and lasted longer than in any other part of Canada.

Now that the recovery is finally here, it has arrived later, taken off slower, and shown more fragility than in any other part of Canada. Barely 20 per cent of the net new jobs that were created in Canada in the first nine months of this year were created in Ontario. And Metro Toronto actually has 194,000 fewer jobs than it had in 1989.

Meanwhile, over the past four years, Ontario has built up the highest per-capita deficit of any province in this country. We now have the dubious distinction of being the largest non-sovereign borrower in the world.

You look at all these phenomena--a deeper recession, a slower recovery, the highest per-capita deficit--and you have to say to yourself: Coincidence? I think not. I think it has everything to do with the decisions that were made at Queen's Park over the past four years.

Premier Rae likes to look back and say his government made the tough decisions. The NDP didn't make the tough decisions, they made the wrong decisions. When the NDP spent its way to a $10 billion deficit in its first year in office and then tried to fix it with a $4 billion tax grab, that wasn't a tough decision--it was the wrong decision. When they passed job-killing amendments to the Labour Relations Act, that wasn't a tough decision--it was the wrong decision. And when they shut down all of Ontario's international trade offices in the midst of the toughest global competition the world has ever seen, that wasn't a tough decision--it was the wrong decision. In a world where business and investment can go virtually anywhere, this government has given them too many reasons to go anywhere but here.

When governments make bad decisions, people suffer the consequences. One of those consequences is a recovery that has all the momentum of a person running through a field of quicksand. A recovery so selective, that young people with their newly learned skills and older workers looking for a way back into the work force can barely tell it's here. A recovery so fragile, it could be easily reversed by the next spending binge, the next tax grab, or the next wrong decision.

I don't think there is a person in this room who is satisfied with this type of recovery. None of us is used to an unemployment level of 10.2 per cent in a city with the diverse economic base and the dynamism of Toronto. None of us is used to an Ontario that has more people on welfare per capita than the province of Newfoundland.

And none of us wants to get used to it. It's unacceptable. We must do better.

The Conservative leader, Mr. Harris, believes he can do better. You will find his programme in a document that he calls "The Common Sense Revolution."

Mr. Harris' programme predicts a 25 per cent slower growth rate than that predicted by the NDP. I say that when someone tells you he can deliver even less economic growth than the NDP, watch out. That's one promise you don't want to see kept.

The strangest thing is that Mr. Harris' numbers just don't add up. He claims that even with 25 per cent slower growth, he can produce 25 per cent more jobs. Can he do that? According to the chief economic forecaster at DRI, a leader in the forecasting field, "That's just not possible."

The Conservative leader says he can cut personal income taxes by 30 per cent without touching 60 per cent of the budget--and still have enough money to eliminate the deficit. Can he do that? Not according to Leo de Bever, one of Canada's foremost economists. Mr. de Bever said, "It makes great sense as a political statement, but I'm not sure it makes a whole lot of economic sense."

I think it's time Mr. Harris admitted what everyone else is saying about his plan. It would push Ontario's deficit through the roof. It would drive our credit rating through the floor. And it would send investment and jobs right out the window.

The good news is that all the ingredients that made Ontario an economic powerhouse, and gave us so much pride in our standard of life, are still here. We still have a well-educated population, sound infrastructure and stable communities. We still live beside the largest market in the world and have good transportation links to the rest of the world. We still have a creative and entrepreneurial people.

Ontario was always the province that works. We can again become the province that works. We can make it work for everyone.

It will take leadership and a commitment to change the way things are done. It will take a government that says, through its words and its deeds, to small entrepreneurs and big investors alike: "Come to Ontario. Stay in Ontario. You are welcome here. We will work with you. Together we'll create prosperity and jobs. It will take a government that is willing to be a facilitator instead of an obstacle.

I want to provide that kind of leadership. Ontario Liberals want to provide that kind of government. We would recognise that in a market economy, the primary job for government is to create a climate for growth.

That means working with the people who create jobs--businesses, entrepreneurs, community groups--instead of putting roadblocks in their way. That means understanding that the tax burden has become too much of a burden on individuals and on businesses. It means recognising that the deficit must be eliminated, but that vital services must be preserved. In my vision of Ontario, we can and must have both a balanced budget and the services people need.

But to have both, government must stop squandering money on programmes and projects that are unnecessary and ill-conceived. And it must stop trying to solve every problem by spending money with centralised, bureaucratic programmes like jobsOntario Training. It's time government realised that local solutions can be more flexible, more responsive and less expensive than bureaucratic policies imposed by Queen's Park.

As premier, I would reduce unemployment to six per cent. That would create at least 150,000 jobs above and beyond what the NDP are predicting.

We must make economic growth, and the jobs that come with it, our number one priorities. It isn't enough to have a recovery that just shows up on economists' charts. We need a people's recovery.

We need a recovery that is big enough and buoyant enough to reach out and embrace entrepreneurs on Yonge Street and St. Clair West who have had to put up many "going out of business" signs these past few years. Big enough and buoyant enough to embrace young people, who still face depression-like unemployment levels. Big enough and buoyant enough to embrace laid-off older workers whose jobs have never reappeared. And big enough and buoyant enough to embrace people on welfare, who need a chance to train and work.

That's what I mean by a people's recovery. A people's recovery means jobs.

Let me tell you some of the ways in which we'll create a people's recovery. Our plan is to cut taxes, eliminate red tape, help business get capital and grow, put Ontario's finances in order, and modernise the way government itself operates.

1. Reducing Taxes

First, we'll reduce overall taxes by five per cent.

People in business tell me that rising taxes--especially payroll taxes--are the number one killer of jobs. Ontario companies cannot afford to pay higher taxes than their international competitors. Higher taxes are also the last thing Ontario families can afford. Many can't afford the taxes they are paying right now.

When it comes to paying taxes, Ontarians have hit the tax wall. It's time government began tearing down that wall. Our commitment to reducing overall taxes by five per cent is practical and doable. It will ease the tax burden without driving the deficit sky-high.

2. Cutting the Cost of Dealing with Government, Eliminating Red Tape

Secondly, we'll reduce the costs of doing business with government and of meeting government regulations by 50 per cent.

When I talk to business people--especially people in small business--the complaint I hear more than any other is that they spend more and more time dealing with governmental red tape, and more and more money on regulatory fees. That leaves less and less time and money to do what they do best--build their businesses and create jobs.

When I was in Niagara meeting with the Wine Council last summer I heard how members of the Council had to spend $4,000 to get 44 separate permits--just to run an afternoon wine-tasting tour. Here in Toronto, the president of Robin-Wood Management, a property management company, told me that the amount of paperwork he does has tripled in four years. There are dozens more examples. Three years ago, the Ontario government promised to "Clear the Path for Small Business." All we've heard since is a lot of talk.

A Liberal government won't just talk about clearing the path--we'll do it. We'll begin by abolishing the annual corporate filing fee, which is nothing more than a $14 million dollar tax grab.

3. Providing Access to Capital and Tools for Growth Thirdly, we'll help small and medium-size companies get access to capital and to other tools they need to grow and create jobs.

Many entrepreneurs have shown me their plans for the future--detailed, innovative plans that would create jobs. They're prepared to take a risk--but they can't find a financial institution to share that risk. A Liberal government will help them get access to capital in a number of ways--such as getting financial institutions to publish clear and fair codes of conduct for their financing practices.

We'll provide other tools, such as community-based business centres that can link businesses with colleges and universities, and help small innovators become better entrepreneurs by giving them up-front information on human resource planning, financial planning and marketing.

We intend to make better use of government procurement. Government must use its purchasing power to help companies in emerging sectors such as communications and environmental technologies.

4. Getting Government's Finances in Order

The fourth part of our programme has to do with getting Ontario's finances in order. Our commitment, as a starting point and as a minimum, will be to balance Ontario's operating budget by the completion of a first term in government.

A balanced budget will attract investment. It will send out a clear signal that Ontario is a fiscally responsible place in which to do business. And it will allow us to pay less in interest every year, so we can continue to invest in knowledge industries and training and healthy communities--the things that attracted investors here in the first place.

Fiscal restraint will be a fact of life for the rest of my political life. That means tough choices. I'm prepared to make those choices. To balance the budget, I am determined to review everything government does, ministry by ministry, programme by programme, service by service. Where there is waste and duplication, we'll eliminate it. Where there are areas in which government is ineffective or just shouldn't be involved--we'll get out.

We'll start by scrapping the failed $1.1 billion jobsOntario Training programme. I'll terminate the Interim Waste Authority, which so far has rung up a bill of at least $50 million. There will be no more foolish decisions like the $168 million Workers' Compensation Tower. And we'll provide a full and honest accounting of government finances. I can't imagine anything more irresponsible than a government that tables a financial statement that is so misleading about its deficit that its own auditor won't sign it.

To regain the confidence of investors, Ontario needs a firm hand, not sleight-of-hand. We'll use the generally accepted accounting principles which are approved by the provincial auditor. A Liberal government will not keep two sets of books.

5. Revamping and Modernising the Machinery of Government

Finally, we'll revamp and modernise the machinery of government.

In too many areas, government is trying to deal with 1990s problems by employing 1960s solutions. The Workers' Compensation Board is a classic example of an agency that isn't keeping pace with change. Its premium hikes are threatening to drive some companies out of business and are preventing many others from hiring new employees. Its unfunded liability is an $11 billion dollar noose around our necks.

I can't put it more bluntly than did Premier McKenna of New Brunswick, who told me a few weeks ago, "With your workers' compensation system, I'll beat you to new investment 10 times out of 10."

The Liberal Party will reform the system, making it both solvent and able to meet the needs of employers and workers. We'll freeze premiums and get the unfunded liability under control by reducing administrative costs and providing better investment management. We will start by putting an experienced insurance executive at the head of the WCB. That's where reform begins. We don't need a commission of inquiry into the WCB that will chew up $2 million dollars of taxpayers' money and delay action for two years. It's clear what needs to be done. It's time to start doing it.

Training is another area where the government's approach has been woefully out of date. Big, centralised programmes aren't the answer to Ontario's training needs. A Liberal government will turn that around. We'll involve communities and local industries in designing and delivering training programmes. We'll work with the people who create jobs--people who understand in a way that government never will--what our training needs are today and what they will be tomorrow.

Training and the WCB are just two areas. But whether it's reforming MPP pensions to end "double dipping," or reducing the bloated staffs of cabinet ministers, we'll bring government into sync with the realities of the 90s.

Ladies and gentlemen, the ideas I've put forward today are not earth-shattering or revolutionary. But Ontarians have felt the earth shake quite enough around Queen's Park the past few years. And while revolutions may make for good slogans, slogans are not what we need.

What we need is a government that understands that its role is to stimulate, not to suffocate. A government that can manage effectively, instead of lurching along from one crisis to the next. A government that understands how to modernise the operation of government itself.

That's the kind of government I want to lead. A government that can work with people and put into action ideas that are sensible, doable and fiscally responsible.

I won't promise you the moon--and then begin backing away from those promises the day after the election. My commitments have been carefully designed and accurately costed to make the best of Ontario's resources.

I promise to dedicate myself to creating a people's recovery--a recovery in whose benefits every Ontarian can share.

It's time Ontario had that kind of leadership. Thank you.

The appreciation of the meeting was expressed by Julie Hannaford, Partner, Borden & Elliot and 1st Vice-President and President-Elect, The Empire Club of Canada.