Treasury board president says new fund will 'empower' cities to lower budgets

Ontario's treasury board president is dismissing criticism of a new fund to help municipalities and school boards find savings in their budgets, saying the $7.35 million is a "smart way" to provide assistance.

In an interview with CBC Radio's Metro Morning, Peter Bethlenfalvy said the Audit and Accountability Fund is a way for the provincial government to "empower" municipalities in a search for efficiencies and is a better way to balance budgets than raising taxes. Ontario Premier Doug Ford unveiled the fund in Oshawa on Tuesday.

"This is not about cutting frontline services. This is about savings and empowering the municipalities to find those savings that we know exist. We think this is the smart way to go forward," Bethlenfalvy said on Wednesday.

"We've offered tools. We've offered funding for those tools."

'We've inherited a staggering amount of debt'

When asked if the fund is a "public relations stunt," which is what Mayor John Tory has suggested, Bethlenfalvy said: "Absolutely not... We've inherited a staggering amount of debt, $1.5 million of interest costs every hour. We have to do something immediately."

Bethlenfalvy said independent auditors could find savings that might have been overlooked by municipal auditors.

"There are always savings. We think they can find more," he said.

"You do what you can. But there's nothing like a fresh set of eyes, an independent third party who brings other skills and other knowledge from other jurisdictions. We rolled up our sleeves day one and got to work right away. We think there are opportunities."

Bethlenfalvy noted he got rid of his land line after he was sworn in on June 29, 2018 as treasury board president. When he saw it on his desk, he asked: "What's that? We got rid of them right away."

Toronto urged to accept offer of help

According to Bethlenfalvy, the government is increasing spending on health care and education in 2019-2020, amounts he described as "historic." He said the province is spending $1.3 billion more on health care and $700 million more on education this fiscal year compared to last fiscal year.

The provincial government said in a news release on Tuesday that the provincial debt is more than $347 billion. Interest on the debt costs the government more than $1 billion a month or $36 million a day.

Bethlenfalvy added that 92 per cent of provincial government funding goes to municipalities, hospitals, school boards and post-secondary institutions.

As for financial challenges facing Toronto in particular, Bethlenfalvy said Toronto's auditor general once recommended 227 areas to save money and Tory, when he was not mayor, said himself a few years ago that the city could give $50 million in savings if it had to do so.

"We owe it to the people of Ontario, the people of Toronto, to do that. I would counsel the city of Toronto to take up our offer."

'This is not easy work. This is hard work'

Asked about the fact that the fund was announced after municipalities approved their budgets for the fiscal year, Bethlenfalvy said the government had to make tough decisions when it got elected because its deficit was worst than expected.

"Let me say, this is not easy work. This is hard work. We recognize that," he said.

Tory responded on Wednesday by announcing the city has launched a petition to fight provincial cuts and he is urging everyone in Toronto to sign it. City officials estimate that the cuts will cost the city $178 million this year.