Archived columns and blog posts by Matt Elliott

Six questions about Ford’s new spin on billion-dollar savings

By: Metro Canada Published on Wed Apr 09 2014

There’s a new addition to Mayor Rob Ford’s campaign website. A “Billion Dollar Savings” button on the front page links to a briefing note put together by Toronto CFO Rob Rossini which details “budget and taxpayer savings” for the years 2011-2014.

The implication is clear. This is supposed to be the smoking gun — the thing that vindicates Ford’s claim of saving taxpayers $1 billion and leaves at least 10,000 eggs on the faces of those of us who have spent the better part of a year poking holes in the mayor’s story.

But it doesn’t really do that. Even with this new data, I still don’t see an angle through which Ford can legitimately say he saved a billion dollars. In fact, the briefing note just confuses things further and prompts more questions. Here are a few of the things I’m asking about.

1) Does Rob Ford have psychic powers?

Ford first started saying he’d saved a billion dollars shortly after council passed the 2013 budget. But the briefing note points to $147 million in efficiency savings, as well as savings from reduced capital financing from the 2014 budget as part of the almost billion dollars in purported savings. (It's actually $972 million.)

So how is it that Ford could be talking about a billion dollars before the first draft of the 2014 budget even hit the printer? Did he guess? Can he see into the future? Or was he basing his claim on something else when he first start talking about his supposed savings?

2) Does Rob Ford take credit for the 2014 budget or not?

But the 2014 budget contributes about 15 per cent of the reported savings in the briefing note. It seems challenging for Ford to simultaneously claim he had nothing to do with the city’s most recent budget when it also contributes to one of his biggest campaign talking points.

3) What counts as savings anyway?

A hypothetical: pretend you come to me one day and say, “Hey, I’m thinking about buying a vintage DeLorean for $50,000 so I can travel around the country cosplaying as Marty McFly” and then I say, “Hey, no. That's stupid.” Can I then claim to have personally saved you $50,000? Can I say that, thanks to my intervention, you now have $50,000 in extra money?

Because that’s really what we’re talking about here with these budgetary savings. In many of the cases included in the briefing note, the CFO isn’t pointing to real-dollar reductions in the amount spent by a city department but rather reductions in planned spending based on various budgeted scenarios. Hell, some of the savings are due to totally uncontrollable things like lower fuel costs, as John Tory pointed out in his recent interview with Metro.

By way of example, let’s look at Transportation Services. The briefing note says the department achieved $15.6 million in savings between 2011 and 2014. At a quick glance, perhaps you’d assume that means the department’s spending decreased by $15.6 million. But nope. Over the same period, Transportation Services’ gross expenditures increased by $49.2 million.

Would the budget have gone up $15.6 million more if someone other than Ford was mayor? Maybe. But maybe not. It’s an absurd game of hypotheticals, like asking what would happen if we elected a puppy. (Meetings would be cuter, probably.)

4) How does making residents pay more for services in user fees count as a savings?

In one of the weirdest parts of the briefing note, the CFO lumps in $30 million in total increases to city user fees as savings. This is an odd practice as it sort of implies that the city should get out of the general tax game and instead move to a more ad-hoc model where everyone gets billed only for the services they use. Then we’d all live in a glorious Libertarian Utopia.

Whatever the case, it’s worth noting that this briefing note, in addition to claiming that a $30-million increase to user fees is a savings, also tries to claim that a $50-million cut to user fees is a savings. On the cut to the city’s vehicle registration tax — a user fee for car owners — the CFO says the “elimination of the Personal Vehicle Tax (PVT) in 2011 has saved the taxpayer $50 million annually based on 2010 collections totalling $200 million over the past four years.”

5) How political should city staff get?

While we're at it, let's ask if publicly-funded bureaucrats should really be opining on what counts as savings to taxpayers. In fact, it’s worth asking if neutral staffers should be using a politically loaded term like “taxpayer” at all, especially in this context where it’s been conflated to mean “someone who owns a car.”

6) Doesn’t all of this just obscure the city’s genuine fiscal challenges?

Look, it’s not hard to figure out where the city’s budget pressures come from. Since 2005, spending at the city — across all non-cost-shared departments except for TTC and emergency services — has grown by about 2.5 per cent per year. This is otherwise known as “inflation.” But spending at the TTC is up by 3.44 per cent per year, and spending at Police, Fire and EMS is up by 5.76 per cent annually. Together, those two departments make up 91 per cent of spending growth since 2005. (For the numbers, check out slide 18 in this budget presentation.)

The city’s real budget problem is not some impossible Gordian knot. Whatever gains politicians make finding budgetary savings at city departments will ultimately be overwhelmed by the two problems exerting the most pressure on the city’s fiscal future: A growing transit system that receives very little support from higher levels of government and a police budget that continues to rise even as crime indicators are on the decline.

Forget about this supposed billion dollars in budget savings — any mayor who can fix those problems would really have something to brag about.

This post was originally published at on 2014-04-09T00:00:00.000Z

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Matt Elliott

City Hall watcher, columnist and policy wonk in Toronto.
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