Ontario government shovels out heaps of corporate welfare

Is there any activity Premier Doug Ford won’t shove onto the backs of Ontario taxpayers? Based on the province’s recently published 2023-24 Public Accounts, there likely isn’t. The proof is in the detailed schedules of payments, which shows the government is willing to make taxpayers pay for anything and everything under the sun in the name of “economic development.”

In 2023-24, much corporate welfare went to automobile manufacturers. The Ministry of Economic Development, Job Creation, and Trade gave “transfer payments” (transfers of money for which no goods and services are received, which will not be repaid, and for which no financial returns are expected) of $80 million to General Motors, $28 million to Toyota, $20 million to Honda, and $7 million to FCA Canada (Chrysler). On top of this, six-figure sums went to various other organizations in the auto sector including auto parts manufacturers.

Another theme for corporate welfare handouts in the name of “economic development” was sugary foods—ironic given the provincial government is also in charge of health care. Taxpayers gave $4.5 million to Mondelez Canada (manufacturer of Maynards Wine Gums, Sour Patch Kids, and other candies), $4.2 million to Dare Foods (cookies, candy and crackers), $2.2 million to Ferrero Canada (chocolates), $1.9 million to PepsiCo (Frito-Lay and Pepsi), and $300,000 to Biscuits Leclerc (cookies and chocolate biscuits).

Other food companies also received sizable corporate welfare sums. Gay Lea Foods Co-operative (dairy products) received $1.5 million in taxpayer handouts, Minute Maid (juices) received $1.3 million, Nortera Foods (frozen and canned vegetables) received $850,000, Belwood Poultry received $516,543, Maple Leaf Foods (meats) received $500,000, Sofina Foods (pork, beef, poultry and fish) received $409,519, and Steam Whistle Brewing (a craft brewery) received $222,516.

Tech companies also received large corporate welfare cheques including $14.2 million to Ubisoft (software and games) and $6.3 million to Communitech Corporation. And for some reason, the Ontario government really likes subsidizing plastic: $361,359 went to Tempo Plastics Limited, $360,000 to Novo Plastic Inc, $333,333 to E Hofmann Plastics Canada Inc, $134,847 to Berry Plastics Canada Inc. and $120,000 to Axiom Plastics Inc.

If that’s not enough, here’s more evidence that the Ontario government will subsidize absolutely anything. A company in Toronto that produces fences received $230,000 in taxpayer transfers, a dog training company in the Town of Erin received $127,174, a manufacturer of industrial engine components in Huron Park received $300,000, a laser equipment company in Kingston received $290,000, and a kitchen cabinet manufacturer in Ottawa received $150,000. And the examples go on and on.

In the name of “economic development” taxpayers gave $150,000 to a manufacturer of custom injection moulds in Brantford, $150,000 to a tool and die shop in Pickering, $200,000 to a window supplier in Oxford County, $133,506 to an equipment company in Guelph, $246,300 to a metal fabricator in Concord, $131,953 to a manufacturer and recycler of pallets and shipping materials in Niagara Region, and $1 million to an excavating company in Norwood.

And these examples (among others) are just from the Ministry of Economic Development, Job Creation, and Trade. Other government departments disbursed yet more such handouts. The problem is there’s abundant evidence corporate welfare is economically destructive. Business activity with value higher than costs do not need subsidies to proceed, while activities that take place only because of subsidies are unprofitable to begin with. The sooner the Ontario government learns this, the less taxpayers will lose.