“(Public sector unions) win over and over and over, and taxpayers pay and pay and pay… Which is why Tim Hudak’s PCs announced this week they would overhaul the arbitration system to help municipalities cope and help eliminate Ontario’s horrible budget deficit.”
- Chris Vander Dolen, The Windsor Star, September 18, 2012

LONDON – It’s time to stand up for taxpayers by fixing a broken system that awards unaffordable contract settlements – a trend fuelled by nine years of the provincial government throwing money at its former union allies, Ontario PC Leader Tim Hudak said today. “And to do it, we’ve brought forward our Ability to Pay Act.”

Hudak made the comments during a tour of Can-Am RV Centre. He added that “if we want existing businesses like Can-Am RV to remain competitive and attract new job-creating investment to places like London, we have to get our fiscal house in order. Businesses won’t create jobs or invest in jurisdictions with deep debt holes.

“We must start with a freeze on new government spending and a mandatory, across-the-board government employee pay freeze for two years,” Hudak said. “But what comes after? Without bold reforms to the things that drive wages and benefits to these heights in the first place – such as the way arbitrators arrive at settlements – we’ll be right back where we started from.”

With a million employees, salary and benefits costs in Ontario have gone up 46 percent, costing taxpayers $60 billion, Hudak noted. “While the economy is barely growing, unaffordable contract settlements are still being handed out – at the expense of taxpayers’ and small business owners.”

As evidence, London police and fire costs have gone up by 50 per cent. London mayor Joe Fontana has called for an independent panel of arbitrators – similarly proposed in the PCs’ legislation – that would consider a city’s ability to pay when deciding such cases. Hudak added that, “the government knows some councils have been forced to raise property taxes, impose user fees or cut services to pay for these contracts – and contrary to what some may think, taxpayers’ do not have deep pockets.

“Once again the Ontario PCs’ are pressing ahead with bold ideas that now include our Ability to Pay Act – another important step to get our fiscal house in order and ensure scarce tax dollars go to the things that create jobs like first-rate transit, reliable roads and tax relief.”

The Ability to Pay Act makes this its goal, in three key ways:

· First, arbitrators’ decisions must factor in specific economic and budgetary realities, like the local tax base and unemployment rate, when making decisions, and explain those decisions in writing;

· Second, establish a panel of independent arbitrators to decide cases within three months;

· Third, dedicate an Ability to Pay Division that would publish comparative information on compensation, as well as proactively disclose all arbitration decisions.

Hudak concluded that “the Ability to Pay Act is about standing up for taxpayers and restoring economic prosperity. On October 4, when the bill comes before a vote, all parties in the Legislature need to support it, so we can help rein in overspending and build a solid foundation for investment and private sector job creation.”