Jul 06, 2015
By Michael Kramer
Standard & Poor’s has dropped Ontario’s financial rating to A+ from AA-, highlighting the provincial debt burden and budgetary “underperformance” compared with peers in other jurisdictions.
S & P says – while Ontario continues to beat its fiscal targets and expects to close its operating budget gap by fiscal 2018 – it will still have to contend with sizable yearly after-capital deficits, given its large net capital spending plans.
The rating agency says the downgrade comes with a stable outlook – and reflects its belief that Ontario will continue to make slow progress – in reducing its deficit.
Ontario Finance Minister Charles Sousa says he agrees with S & P’s forecast that the province is on track to eliminate its deficit by 2018.
Sousa says he believes the S & P assessment views Ontario as having a strong, diversified economy – despite recent slow growth.
But Progressive Conservative Leader Patrick Brown said the rating decline is proof that the government is mismanaging the economy.