Cost-cutting Ontario will privatize services, sell LCBO property
To raise money and cut costs Ontario will sell the downtown Toronto LCBO warehouse and privatize more Service Ontario operations, Finance Minister Dwight Duncan said Monday.
The government — which is preparing for the release of Wednesday’s Drummond report on cost-cutting — will also look at scrapping horse racing subsidies that have cost taxpayers $3.4 billion since the previous Progressive Conservative government started them in 1998.
Selling the LCBO warehouse and head office on valuable waterfront land ripe for redevelopment is expected to generate over $200 million, Duncan said in a luncheon speech.
“We can make better use of the property to maximize the value of this taxpayer asset,” he told a crowd of 500.
“A flagship retail store will remain in the vicinity, while head office and warehouse could be moved.”
Duncan warned that the former TD bank chief economist Don Drummond had warned him that the government’s annual deficit — slated for $16 billion this year — could balloon to $30 million by 2018 if the way public services are delivered are not “transformed.”
In last October’s election campaign, all three major parties promised to slay the deficit by 2018.
“It is clear that this serious challenge requires a serious plan,” Duncan said.
For Service Ontario, about two-thirds is already privatized with online transactions costing about $1 each — much lower than the $3 to $8 for in-person transactions such as renewing drivers’ licences or getting birth certificates.
“Obviously, greater efficiencies can be gained by driving customers to a lower-cost, online channel,” Duncan said.
The horse racing subsidies topped out at $345 million last year through the Ontario Lottery and Gaming Corporation’s “slots at racetracks” program.
“It’s more support than we provide for water protection or road safety to protect our families...that kind of money would pay for over 9 million hours of home care,” said Duncan.
The contract lasts another year and will be honoured until then, a ministry official said.