Neoliberalism, Public Services and Labour in Toronto
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- Published on Saturday, 04 June 2016 22:30
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A Socialist Project e-bulletin .... No. 1264 .... June 5, 2016
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Excerpt from Megacity Malaise:
Neoliberalism, Public Services and Labour in Toronto
Carlo Fanelli
City Manager Peter Wallace recently released a report on The City of Toronto's Long-term Financial Direction. The analysis is the latest to reinforce what many earlier studies have long been arguing: that the city of Toronto does not have a spending crisis, but a revenue crisis. It found that "cost containment" measures have produced some $300-million in savings since 2010, but that this has done little to address the structural deficit at the root of the city's financial challenges. The report notes that, consistent with the austerity approaches adopted by the governments of Ontario and Canada, city government is less expensive today than it was six years ago: some $165 or... 3.8 per cent less per resident (in 2016 dollars). And yet, despite austerity targets totaling some 16 per cent over six years, and the elimination of 1,374 positions, the City has been unable to stop, let alone reverse, the growing revenue crisis that has been a hallmark of urban governance.
Wallace's report also found that when adjusted for price inflation property taxes have actually fallen 4.8 per cent since 2010, the lowest of any major city in Ontario. At the same time, TTC fares have risen more than 17 per cent, recreational programs and permitting are up 9 per cent, while waste, water and parking have jumped 24 per cent. The practice of deferring capital expenses has also continued apace and is now conservatively estimated to leave the city $1-billion short per year of its needs by 2021. Should any number of uncertain revenue streams dry up, such as the land transfer tax which is up 167 per cent, this could significantly raise the revenue gap. Other pressures include: funding requirements for the TTC and Toronto Community Housing, annualized costs related to earlier capital and operating commitments, addressing prior year deferrals of employee benefit liabilities, and adjustments in response to the loss of the Toronto Pooling Compensation grant from the Ontario government, let alone council promises to implement its poverty reduction strategy, clamp down on runaway police budgets, and address the inadequacy of social assistance. As Wallace makes clear: "operating expenses are not simply government spending for its own sake – they are investments of vital public resources by Council toward a broader public good. Similarly, capital investments address issues around livability, congestion and public space in our dynamic and increasingly dense and complex city."