Ontario budget: Free tuition for low-income students

TORONTO – Finance Minister Charles Sousa delivered the Ontario budget on Thursday. Here are some of the highlights:

POST-SECONDARY STUDENTS: College and university students from low-income families stand to benefit the most from the Liberal government’s fiscal plan. Starting in the 2017-18 school year, the province will create a new grant — called the Ontario Student Grant. Under the new system, tuition will be free for students from Ontario families with incomes up to $50,000 who attend any college or university in Canada. More than half of students from families with incomes up to $83,000 will receive non-repayable grants that exceed the average tuition — mostly students who live on their own. No Ontario student will receive less through the new grant than they are currently eligible for through the Ontario Tuition Grant.

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CAP AND TRADE: Proceeds from the cap-and-trade system — which is designed to reduce Ontario’s greenhouse gas emissions — are projected to be $1.9 billion in 2017 — up from last year’s projection of $1.3 billion — and will be used to invest in green projects and climate change initiatives. However, the program comes at a cost to Ontario ratepayers. The average natural gas cost to households will increase $5 per month, while the price of gasoline will go up about $4.3 cents per litre — or about $8 per month.

CIGARETTES AND WINE: The prices of cigarettes and wine are going up. There will be a $3 increase in the price of a carton of 200 cigarettes, effective at 12:01 a.m. Friday, and the tobacco tax will keep rising at the rate of inflation each year over the next five years. The minimum price for a bottle of wine rises to $7.95 over the next three years, and there will be a series of increases in the ad valorem tax on wine, starting with a two percentage point hike in June, another two points in 2017 and 2018, and a one-point hike in 2019

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— Single seniors earning up to $19,300 per year will be eligible for cheaper drugs starting in August, compared with the previous threshold of $16,018. Couples with an income of up to $32,300 will also be eligible, where before only those earning $24,175 qualified. The costs will be offset by raising deductibles and co-payments for seniors above the new income thresholds. Annual deductibles will rise to $170 from $100 and co-payments will increase by a dollar to $7.11.

— The $30 fee for Drive Clean vehicle emissions tests will be eliminated in 2017-18, but not the tests themselves, which will cost the province $60 million a year.

— Shingles vaccines for seniors, which cost $170, will be free.

— The budget deficit for fiscal year 2015-16 is expected to come in at $5.7 billion, down from the last estimate of $7.5 billion

— The deficit for 2016-17 is projected to come in at $4.6 billion and be reduced to zero the following fiscal year

— Ontario’s net debt will hit $308 billion in 2016-17, the largest of any sub-national jurisdiction in the world, costing $11.8 billion in interest payments, which will increase to $13.1 billion by 2018-19

— Hospitals will get their first funding increase in five years, up $345 million, plus $12 billion over 10 years in capital grants for about three dozen major hospital projects

— There will be $333 million over five years to redesign and improve autism services