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Liberals pressed on cost of credit rating change

Province spending billions on interest charges - and that could go up.

The opposition Tories at Queen's Park continue to press the Liberals on fears a credit rating downgrade is in Ontario's future.

If that happens, more taxpayer dollars will be spent on interest payments. This fiscal year, the province expects to pay $11 billion in interest on its $295.8 billion of debt alone. If that interest rate goes up by just one percentage point, it means they'll shell out $400 million more of your money for interest payments.

Ontario already paid $10.5 billion in interest on its debt last year.

Last week, Moody's changed its fiscal outlook for Ontario from stable to negative, based on uncertainty the province will pay down its $12.5 billion deficit by 2017-18.

Its credit rating stays at the Aa2 level but has a greater chance of being downgraded later on with this move. A downgrade, means a change in interest rates on government loans.

Interim Progressive Conservative leader Jim Wilson says means less money for program spending which could translate into services in healthcare and education taking a hit. If not, the province could compensate by raising taxes.

Premier Kathleen Wynne defended the Liberals big-spending budget in Question Period. She says they will be able to meet deficit targets.

The budget will be tabled again on July 14.

 Related Content:

A credit rating downgrade could affect you

 

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  1. You Wanted This posted on 07/08/2014 05:08 PM
    But it's all worth it, because otherwise there would be 75,000 public-sector bureaucrats finding themselves jobless over the next four years, and another 25,000 who would retire with the knowledge that nobody would occupy their sinecure after they were gone. And that would just be horrible.
  2. john posted on 07/09/2014 12:08 PM
    and so it begins the end of this province .
  3. frank posted on 07/10/2014 06:50 AM
    That's nearly $80 per month per citizen, just on the interest. Family of four? The province must spend $320/mo. just for your portion of the interest. Not a smart use of moeny.
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