[greenon-l] Green Pieces in the Budget

[Conservation Council of Ontario]

If the rest of this message is blank, please go to www.greenontario.org for 
the newsletter...

Green On.
The Online Newsletter of the Conservation Council of Ontario
see www.greenontario.org for the online version and to subscribe or unsubscribe

Budget 2004:
Conservation Accounting Makes Inroads
Chris Winter, Executive Director
May 19, 2004



There was no single big green announcement in yesterday’s Ontario budget, 
but there were a whole bunch of little things that add up to nearly a 
billion dollars in green investments.  There are also a number of 
interesting trends in fiscal management and strategic planning that will 
have a significant potential for conservation and the environment.


--- Infrastructure Commitments ---
This is the green infrastructure budget  with water and transit getting 
significant new commitments.  Ontario’s crumbling infrastructure is a major 
concern and the government has committed a total of $3.3 billion to 
infrastructure investments.  Of this, $346 million goes to water and $448 
million goes to transit.  $992 million still goes to fixing and expanding 
highways, which is twice the commitment to transit, however the funding 
trend is clearly moving away from highways.


--- Electricity ---
The budget was silent on the other major infrastructure 
question  electricity.  There’s not much in the way of financial 
commitments to report in the electricity sector  just tax breaks on clean 
home energy sources and energy efficient appliances that will cost about 
$11 million.  No commitment was made with respect to the funding required 
to replace Ontario’s electrical infrastructure.  Here’s why: the consumer 
is going to pay, not the taxpayer.


--- Conservation Accounting ---
Page 31 of the budget papers outlines the fiscal implications of the 
government’s electricity sector reforms.  Here you’ll see the first signs 
of “conservation accounting”  paying full cost for resources and creating 
direct links between consumption taxes and the conservation 
alternative.  The budget reiterated the commitment to move to a 
“consumer-pays” system for electricity and away from the traditional 
“taxpayer-pays” approach. The new approach will provide a tremendous 
incentive for conservation.

The other example of conservation accounting in the budget is the 
commitment to link two cents of the gas tax to transit funding.  This is 
perhaps the best example of using a pollution/consumption tax to directly 
subsidize a low-pollution/conservation alternative.

“Conservation and sustainability of resources” was one of four key 
strategies outlined in the Town Hall consultation process.  Clearly, the 
government is moving ahead with pricing as an alternative revenue 
generating option, a cost-recovery mechanism for infrastructure 
investments, and as a key tool to promote conservation and the efficient 
use of scarce resources.  With the one caveat of needing to protect 
low-income groups from price spikes, this is an excellent initiative that 
will help promote a conserver society, an efficient and competitive 
economy, and sound fiscal management.


--- Gas Tax ---
The Province has made good on the commitment to transfer two cents of the 
gas tax to municipalities to help pay for public transit.  One cent will 
dedicated beginning October 2004.  This will increase to 1.5 cents in 
October 2005 and 2 cents in October 2006.


--- Natural Areas ---
Natural areas protection got a small boost with the extension of the tax 
exemption for conservation lands to cover lands of natural and 
environmental significance owned by conservation authorities and land 
trusts (an estimated $1million program).


--- Funding up for Green Ministries  up $50 million ---
·       Ministry of Environment $260 million to $304 million (+44)
·       Ministry of Energy $118 million to $137 million (+19)
·       Ministry of Natural Resources dropped from $518 million to $505 
million (-13), but still remains higher than the 2000 to 2003 levels.


--- Four-Year Plans ---
The other interesting development is that the government is 
replacing  “ministry business plans” with a four-year plan based on clear 
provincial objectives and with six-month progress reports.  The emphasis 
will be on planning for results.

Unlike the former business plan process (where consultation came six months 
after the plans were finalized), the government intends to hold 
consultations throughout the entire process  from setting priorities to 
reviewing the results.

One thing that is not clear is how the Statements of Environmental Values 
(SEVs) under the Environmental Bill of Rights (EBR) will fit into the new 
approach.  The EBR requires that ministries consider their SEVs in all new 
initiatives.  (Readers will no doubt recall the detailed “Missing Values” 
reviews of ministry business plans conducted by the 
CCO  www.greenontario.org/cco/publications.html.)

The government needs to update the thirteen ministry SEVs ASAP if they are 
going to have relevance within the new planning regime.


--- Red Tape ---
The Red Tape Commission will be converted into a small business 
agency.  Not much more needs to be said about this one.


--- Horse Sense? ---
Finally, every budget usually has something that’s just downright 
wacky.  The dance around lotteries and gaming revenue is always 
interesting  trying to justify how gambling is a social good.  Of the total 
gaming revenue of $2,117 million, hospitals get 1,474 million (70%), $512 
million (24%) goes into “general government priorities”, problem gambling 
gets 36 million (1.7%) and the Ontario Trillium Foundation gets $95 million 
(45%).  Trillium is the largest single source of funding for voluntary 
sector environmental projects in Ontario, with a budget of $10 million for 
the environment sector.

At the same time, $299 million (20% of the gross revenue from slot machines 
at racetracks) goes to support Ontario’s horse racing industry.  Compare 
this with, say, the budget commitment of $13.4 million for affordable housing.

In Ontario, horses are getting better far better treatment than the homeless.

***************************
Promoting conservation leadership, cooperation, and action for over 50 years
The Conservation Council of Ontario
43 Sorauren Avenue, Toronto, Ontario M6R 2C8
(416) 533-1635
www.greenontario.org
Chris Winter, Executive Director
-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://list.web.net/archives/greenon-l/attachments/20040519/60f29df9/attachment.html