Now we know how Premier Dalton McGuinty plans to raise revenue to pay down the province’s $250-billion (and growing) debt by 2017 without raising taxes. He’s going to gamble on gambling.
The Ontario Lottery and Gaming Cooperation (OLG) is promising an additional $1.3 billion to the province’s coffers by 2017 with the addition of a new casino in the Greater Toronto Area (GTA) and other “programming expansion”. The OLG currently claims it makes $2 billion in annual contributions to the province.
Ontario Finance Minister Dwight Duncan with OLG Chair Paul Godfrey at his side announced this week plans by the OLG for a privately run casino in the GTA. Godfrey added that the sale of lottery tickets would spread to more locations including big box chain stores (such as Walmart). The province will also go after a share of online gambling, to be up and running by 2013, while consolidating or closing “underperforming” gaming facilities in border cities, Windsor and Niagara Falls.
Politicians are hoping – like any lottery ticket holder – that their anticipated revenue numbers will help them solve their money woes.
Increasing gaming sites is being seen as a better gambit than another often proposed solution – especially from those on the left of the political spectrum – raising taxes on big businesses. While the provincial government needs to increase revenue, a business tax increase might have the opposite effect when businesses respond by moving to jurisdictions offering lower corporate tax rates. If that happens, everyone loses, especially the workers who lose their jobs.
It’s not as if it hasn’t been done before. We have only to look at the recent move to the southern United States by Caterpillar, a company that had been in this province for decades.
The other option to raise the kind of money the government needs would be to raise personal taxes which are already bordering on being oppressive and in all likelihood a non-starter.
So, why not a casino? People from all walks of life enjoy recreational gambling and already travel out of town to such places as Niagara Falls and Casino Rama to gamble. The idea is to make it easier for them and profitable for us by keeping the money here.
Proposed Toronto locations include the CNE grounds, Ontario Place, Downsview Park and Woodbine Race Track all of which will be very accessible and attractive to visitors.
Increasing gaming would create jobs in the medium term in the construction industry and in the longer term, once the new casino is up and running, especially for low-skilled workers who have a better chance of finding employment in the service industry.
Toronto is only one region of the GTA being considered for the site of a casino. Of course, the city will have to be on side for this to happen and, with our politically divided council, there is no telling what the outcome of a vote at the city will be. Mayor Rob Ford and his supporters have already spoken in favour while the left leaning councillors seem to be against.
However, since the provincial government owns Ontario Place, which was shut down earlier this year and is now sitting virtually vacant, it could be an attractive site for the OLG since the approval of the city won’t be an issue.
In fact, with the Toronto region’s current unemployment rate of 8.6 per cent, which is higher than the 7.4 per cent national average, the addition of a casino here is one obvious answer for job creation while increasing the revenue stream.
However, there is a downside to having a casino in the city. Apart from the issue of gambling addiction and its related social costs, there is the potential for increased criminal activity – prostitution, money laundering, organized crime, for example – which will present an added challenge for law enforcement. Add to that the fact that the plan is for the casino – and other gaming facilities – to be privately owned and operated with the OLG only in a supervisory role.
And a casino does not guarantee financial success, as stated earlier, the government does plan to close some of its casinos which are losing money. Imagine that!
Also problematic is the fact that, with a casino so close at hand, young people might be snared into a life of gambling and the addiction that sometimes takes hold of the weaker among us. The question we will have to ask ourselves is: Is it worth it? Yes, we need the money, but at what cost?