Government and auditor general at odds over size of Ontario’s deficit
Finance Minister Charles Sousa and Treasury Board President Liz Sandals say Ontario’s deficit last year was $991 million while auditor general Bonnie Lysyk maintained it was $2.44 billion.

TheStar.com
Sept. 7, 2017
Robert Benzie

It’s not quite Mayweather-McGregor, but the stakes are high in the accounting slugfest between the provincial government and the auditor general.

Finance Minister Charles Sousa and Treasury Board President Liz Sandals — and the bureaucrats in their ministries — say Ontario’s deficit last year was $991 million, while auditor general Bonnie Lysyk maintained it was $2.44 billion.

At the same time, the province said the net debt was $301.6 billion, while Lysyk calculated it was $314.1 billion.

The actuarial dispute — a reprise of last year’s tussle between Queen’s Park and the fiscal watchdog — stems from a difference of opinion over whether the government should include on its bottom line its share of assets from the teachers’ and public servants’ pension funds that it co-sponsors.

Sandals on Thursday shrugged off Lysyk’s accounting interpretation, which lead to her to issue a qualified audit opinion on the province’s books for the second year in a row.

“The experience last year was the books were qualified on the same issue and it didn’t impact the credit ratings,” the treasury board president said.

“Quite frankly, I don’t think the public is terribly hung up on accounting disagreements.”

Sousa noted the books are balanced this year, but he refused to bite when asked what plans the Liberals have for an expected budget surplus next spring before the June 7 election.

A government-appointed panel of accounting experts concluded earlier this year that Lysyk erred when she claimed the province couldn’t count as assets the taxpayer-funded surpluses in the co-sponsored Ontario Public Service Employees’ Union Pension Plan and the Ontario Teachers’ Pension Plan.

Still, the auditor general, who has sparred with the government for years on myriad issues, stuck to her guns.

“The Legislature and all Ontarians must be able to rely on the province’s consolidated financial statements to fairly report the fiscal results for the year. This year they cannot do so,” she said.

Lysyk warned that her next target will be an audit of the government’s 25-per-cent electricity rate cut, which “may lead to a larger understated deficit and net debt next year.”

A special report on the scheme will be released this fall.