City budget document pegs 2012 shortfall at $530 million (or less)

$774 million. $744 million. $774 million. That number has loomed ominously over every City of Toronto committee meeting for weeks now. The number is like a scythe. Like a sword. Like a scythe and a sword and a bevy of other sharp objects, swinging back and forth above our collective head, — lower and lower — ready to chop us and our finances to tiny bits.

Councillors have been singular in focus: let’s dig our way out of this budget hole before we do everything else. Yes, we have serious issues with customer service and crumbling infrastructure and a lack of social housing and so on, but, we’re told, we need to toss that aside until we can figure out how to address our $774 million budget shortfall. It’s the top priority — the only priority — and we’re going to have to make tough decisions to do it.

All that said, it really is kind of funny that a strategy to knock that $774 million down to $530 million without service cuts was included in a 2011 budget presentation adopted by both the City’s Budget and Executive Committees this past winter.

Here are the tables, direct from the City’s website, as found on page 63 and 64 of last year’s budget presentation:

What this says: We can reasonably expect, before any service cuts or efficiencies, at least $167 million in revenues that can go toward balancing next year’s budget. An expected TTC fare hike of 10-15 cents would bring in another $30 million, and a 2.2% property tax increase would add $47 million to the pile, making for a total reduction of $244 million off the much-ballyhooed $774 million figure, leaving us at $503 million in realistic opening budget pressure. (And these are low-estimate figures!)

This isn’t new information. Councillor Gord Perks has been saying for weeks that the $774 million figure is trumped up. Ed Keenan wrote a gold standard column for The Grid explaining why Perks is probably right. But it still seems startling to me that Ford and his council allies are continuing to trumpet their three-quarters-of-a-billion-dollars shortfall figure even though they were presented information last winter that showed the expected shortfall numbers for 2012 as significantly less.

This doesn’t mean that there isn’t a problem

Two things to keep in mind: for the most part, the left-wing’s skepticism regarding the Ford budget numbers isn’t meant to deny that a) there is a significant budgetary pressure for 2012 that will require some difficult decisions; and b) the city does face a structural annual opening deficit that is, ultimately, unsustainable. Both these things are true.

The issue we’re having is that Ford is leveraging a singular budgetary challenge for 2012 — which could be overcome through similar tactics as has been done to deal with same-size shortfalls in past years (see the above chart, from the same budget document) — to embark on a rushed and extremely flawed process to immediately tackle the city’s systemic budget issues. The only possible outcome to doing things this way involves drastic, sudden cuts to public services.

Which actually makes for the perfect scenario if you’re a politician with an almost fetishistic passion for killing government programs.

Tags: , ,

Comments are closed.