The federal budget, $280 billion in overall spending, a $78.3 billion deficit. Then we have Ontario's fall economic update, around $235 billion in spending and a $13.5 billion deficit. That's how it shakes out on a spreadsheet. But what do those numbers actually mean? What can they tell us about our government's real priorities and our auto on Queen's Park? On the same page, I got some insight from TVO Today's John Michael McGrath. John Michael McGrath, welcome to the program. I feel like you're everywhere: tvo.org, OnPoli, and now you're officially on The Rundown. This looks probably a little familiar to you.

On the same page, I got some insight from TVO Today's John Michael McGrath. John Michael McGrath, welcome to the program. I feel like you're everywhere: tvo.org, OnPoli, and now you're officially on The Rundown. This looks probably a little familiar to you.

Yes, same room, dressed slightly differently, but happy to be here.

TV magic nobody needs to know. All right, let's start with the Ontario Economic Update. What were the sort of big differences between this release versus let's go back to the spring 2025.

So it's a $13.5 billion deficit, which is a slightly smaller than what the government was projecting earlier this year in the spring. That's primarily being driven by stronger than expected tax revenues. And they've held the line more or less on spending. It has not grown very much. That said, there are some storm clouds that the government is worried about. Economic trouble. The economy has already contracted slightly in the previous quarter, and we're not projecting an outright recession, which is two quarters of consecutive shrinkage, but they are concerned about that. And so there's a lot of money in this budget. Sorry. This fall economic statement for, you know, supporting workers, supporting businesses, helping to diversify Ontario trade, that kind of thing.

All right. You talked about budget. Let's show some graphs. Actually this is looking at the federal budgets 2025 projected deficits. If we start on the left, you'll see 78 billion for the 2020, 2526 year. You can see that dark number there. That is the capital investment which we will talk about. And then as you move down to the right, $65 billion to the next, and then we gradually fall to $57 billion. So how does Ontario's deficit projections compare with those we saw in the federal budget?

Well, smaller to begin with. The of course, the Ontario budget is smaller than the federal one, but the deficit is much more manageable provincially than it is federally. And the way you can tell that is that Ontario is hoping to have its budget more or less balanced within two years time. That is not the case federally. We just saw in that chart deficits more or less as far as the eye can see, federally speaking. Now, the type of deficit is going to change if the federal government's plans go the way they want to. So they are looking to really shift the deficit from funding the sort of the day to day operations of the government, which is more or less what is happening now and really hoping to shift that into longer term capital investments. This is what Mark Carney means when he says he wants the government to spend less but invest more. And so they are looking at big capital projects, things like the always promised, never built high speed rail between Toronto and Montreal, that kind of thing.

All right, actually, let's pull up another chart here. This is the capital investments historical and projected. You can see on the left side from 2020 2021 a bit lower, around 10 billion to about just under 30 billion. And then we see these bigger numbers. Now it should be important to mention historical versus projected with those numbers. When we're looking at this chart, will that change drastically. Just looking at sort of what what historical versus projected.

Yeah. And so I guess there's two things to say there. You can see that the capital spending has been heading up slowly in prior years, but that doesn't explain the deficit. The deficit is overwhelmingly been driven by a very large increase in spending since Covid 19. In particular, the future increases. That's really where we're going to see whether the federal government can really meet its promises in terms of getting capital spending out the door. And, you know, this is ties into things that Mark Carney has been talking about. About, you know, faster approvals for federal projects, that kind of thing. Both the provincial and federal government have introduced legislation to really streamline approvals, that kind of thing. And they so far, we've seen some small steps in that direction. The next several years, of course, we're going to see whether the federal government can match an increase in spending with faster approvals and actually get things built faster.

All right. Both governments announced more money for capital infrastructure projects, as you mentioned. What did they say about support and funding for skilled trades? Obviously lots of headlines around that. Perhaps the Ontario government would say not the greatest headlines, but what kind of supports are there for jobs for for investments and that that will be required.

Yeah. So like nothing gets built without somebody putting a nail in a two by four somewhere. And so both governments are making lots of money available to help support skilled trades. Now you alluded to the Skills Development Fund that the provincial government has. This is something like $1.5 billion that the government has disbursed to various groups over the last several years. That is staying at its current level of funding in the current fall economic statement. No changes there now, no changes, for better or worse, because of course, it has been a bit of a scandal for the last several weeks because it turns out that some of the recipients of that money have been politically aligned with the government, and they have then turned around in some cases and spent that money on lobbyists who are themselves close to the government. So a bit of a scandal there. The government, of course, denies any impropriety. We should say that federally, the budget does include $75 million for what they're calling the Union Training and Innovation Program. This is also intended to help support skilled trades and particularly, as the name implies, unionised skilled trades. So, you know, you can see both governments are very alive to this notion that they want to get things built, that building things is going to require skilled workers. For many years, both federal and provincial governments around Canada have been very worried about a wave of retirements shrinking our skilled trade labour force. So this might arguably be overdue. And, you know, again, I think we will see how this plays out. I think certainly provincially, there's been a lot of success in recruiting people into the skilled trades. And one of the prior Labour ministers was very, very passionate about what he said, like removing the stigma of the skilled trades, getting, you know, high school kids to think of trades as an alternative to solely going into university. And yeah, they are working on this and this is obviously a priority for both levels of government.

JM, we are going to leave it there. Thank you for that. Quick 101 on the Ontario Economic Fall update and the budget.

Thanks for having me.