The Ontario Progressive Conservatives $4 billion problem

By: Laura Steiner

The Ontario Progressive Conservatives (PC’s) have an expensive problem.  The three leading candidates in the race to replace Patrick Brown have all promised to eliminate the carbon tax in the “People’s guarantee,” signed last November. The cap & trade policy is where businesses pay for whatever emissions created.  If they use less, they can barter with other businesses who use more creating a market where credits are traded.

The carbon tax proposed by the Ontario PC’s would be revenue neutral, and replace the cap & trade system.  The consumer would pay the tax, but they would also see benefits via a tax break.  The PC’s expected to make $4 billion on this.  The money was supposed used to fund tax cuts that work out to 2% for middle-class  (9.15%- 7.1%), and roughly 1% (5.05-4.5%) for the lower income-earners. It’s there because of  the introduction of a federal carbon tax.  Environment Minister Catherine Mckenna is threatening to impose one on jurisdictions that do not have one in place by the end of this year.  If Ottawa imposes a tax,  the majority of that money would be sent to Ottawa.  The carbon tax is in the platform so Ontario could keep the majority of it to fund things like tax cuts, transit, or mental health spending.

There is a $4 billion hole without it.  Doug Ford, Christine Elliott, and Caroline Mulroney have signed a “no carbon tax pledge.”  The logical question becomes how to address the shortfall.  Mulroney has said that as Premier she would look for cuts in government waste.  There are definitely areas that could be cut.  $4 billion might be a stretch.  The questions for all: What if you can’t find all the money? Would you cut a promise or two? Maybe give a 50% refund on childcare costs instead of 75%? Push the mental health funding on down the road a bit? Doug Ford is against the carbon tax as well.  He faces the same questions as Mulroney.

Christine Elliott is perhaps in the most trouble on this.  She has gone from “consulting the membership, on a potential replacement” to an outright opposing the idea; leaving her open to the “flip flop” label.  She is also the closest  to acknowledging the truth that a carbon tax might be here to stay.  Choosing the poison, means revenues raised can be better directed to where Ontario needs it.

Last November the PC’s met for a policy convention.  Enough members supported this idea of a carbon tax to let it pass in the platform.  Change it now, and you let the members know how little they matter.  First win the leadership, and go from there.   But be prepared to solve the $4 billion problem