Comments on Ontario PC Policy Platform

by Kevin Milligan

UPDATE March 12, 2018:

Because of the change in leadership of the Progressive Conservative Party of Ontario, my words below no longer represent my current views. I wish the voters of Ontario good luck with their choices. KM

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I am Kevin Milligan, Professor of Economics at the Vancouver School of Economics. My disclosure information is here.¬† Below are some comments about the recently-released Ontario Progressive Conservative platform. These are my words and my opinions, and I have received no compensation. See my FAQ #5 for why I’m making these comments.

I have comments on two aspects of the Ontario PC policy platform: the proposed Ontario Child Care Refund and cost management through a value for money audit.

Ontario Child Care Refund

The proposed childcare measure takes the existing deduction for childcare and replaces it with a credit that refunds up to 75 percent of the cost of childcare.  This proposal has two main advantages. First, it delivers the largest benefit to lower and middle income families who most need help with childcare expenses. Second, it supports flexibility for those families who need part-time care, shiftwork, or irregular care arrangements. The Ontario PC proposal is similar to what was proposed in this paper by Alexandre Laurin and me, based on the existing policy in Quebec. More background on the justification for a refundable childcare credit policy can be found here.

I was contacted a few months ago by members of the Ontario PC policy team who informed me of the childcare policy plans. They were interested in my views on how to properly assess the potential costs of their proposal. I have had several conversations with the Ontario PC policy team, and I have reviewed their final costing in detail. I think the quality of their costing analysis attains the standard I expect, and the cost estimates are reasonable.

To summarize, the Ontario PC childcare proposal offers improved, flexible benefits for all Ontario families. The costing analysis follows standard practice and gives reasonable estimates.

Value for Money and Cost Management

The Ontario PC policy platform proposes to find 2.8 billion in savings by 2021. Controlling costs for a provincial government in Canada depends mainly on the organization and compensation of public sector workers. In my view, a government with firm attention to cost management can achieve savings in the range proposed by the Ontario PC platform.