This blog was originally published in Professor Mark Winfield's bog.

Ontario environmentalists have generally been breathing a sigh of relief over the re-election of the McGuinty government, with its implication of the continuation of the Feed-in Tariff system under the Green Energy Act, and more general avoidance of the major retreat by the province on environmental matters that would almost certainly have accompanied a PC victory. However, as I noted in my previous blog, even with the re-election of the Liberals, the possibility of some sort of retrenchment on the environment, particularly in light of the province’s fiscal situation cannot be ruled out. In fact, I am increasingly of the view that a major restructuring in the province’s approach to environment and natural resources management is likely, most probably through the 2012 budget. Such a development would not be unprecedented – recall the 1996 federal Liberal Program Review budget that followed the relatively progressive 1993 “Red Book” platform. Moreover, in terms of core environmental protection and natural resources management policy, such moves could be seen continuations of the status quo ante for the government.

We have already seen moves in this direction, particularly the 2009 transfer of responsibility for forest management from the Ministry of Natural Resources (MNR) to the Ministry of Northern Development and Mines (MNDM), clearly signalling a shift in emphasis from multi-functional forestry to economic development. In the case of the Ministry of the Environment, the government has claimed that the shift to a “permit-by-rule” or “registration” system, where project and facilities are ‘deemed’ to have approvals if they indicate compliance with standards established by the ministry, as opposed to detailed review by ministry staff, will permit the transfer of resources from environmental approvals to enforcement and other ministry functions. However, given the province’s fiscal situation, the more likely outcome is for those resources to disappear from the ministry’s operational budget and staff.

The Commission on the Reform of Public Services, chaired by former TD Bank Chief Economist Don Drummond, is scheduled to report in time to influence the 2012 budget. Expect the Commission’s report to contain a strong focus on new public management (NPM) approaches to the delivery of the province’s regulatory functions in relation to public goods. New public management models emphasize self-management and self-regulation by regulated industries. The model is epitomized by the Technical Standards and Safety Authority (TSSA) and Electrical Safety Authority (ESA), created by the previous Progressive Conservative government. These not-for-profit corporations, whose boards of directors are dominated by representatives of the regulated sectors, took over the public safety regulatory functions of the Ministry of Consumer and Commercial Relations and Ontario Hydro respectively. The same government’s moves in the direction of replacing compliance inspections by ministry staff with industry self-inspection and compliance reporting in relation to forestry, aggregates and other natural resources sectors reflected the similar principles.

Despite considerable evidence of serious problems with these models in terms of their effectiveness in protecting the public and providing for accountability, transparency and access to information, particularly in light of events like the August 2008 Sunrise Propane explosion, the Liberals pointedly left the NPM structures established by the Harris PCs in place. They were, in fact, extending them to other sectors, like the regulation of nursing homes. A strong push further in this direction in relation to the province’s remaining regulatory functions, particularly at the Ministry of the Environment, as first proposed in the post-Walkerton Gibbons report (and rejected by the Walkerton Inquiry), is almost certain.

A major restructuring among environment and natural resource agencies is also possible. The MNR is perhaps the most vulnerable in the context. It is possible to envision the dissolution of the ministry, with its remaining resource management functions (e.g. mineral aggregates, petroleum, brine, fur and wildlife) being transferred to MNDMF and its conservation and planning functions being moved to what remains of the Ministry of the Environment or even the Ministry of Municipal Affairs and Housing.

Given the centrality of urban areas and larger towns and cities to the Liberals’ survival as a government, municipalities are likely less vulnerable to a repeat of the “who does what” downloading exercise of the “Common Sense Revolution.” The 2004-06 land-use planning reforms (the Greenbelt, Places to Grow plan and Planning Act Revisions) can also be expected to survive, although it remains to be seen how active the province will be in backing up its policies as they are challenged before the OMB by some municipalities and developers.

While the NDP might be expected to oppose some of the potential backsliding, the government will likely be able to bring the PCs on-side both in terms of budgetary measures and any required implementing legislation. None of this can be seen as good news for the protection of public goods in Ontario. The role of self-regulatory models in the financial services sector in permitting the behaviour that led to the 2008 financial crisis is well recognized, even among some of their proponents. Those experiences should have lead to some serious reconsideration of the use of similar approaches in relation to the protection of other public goods, such as the environment, public health and public safety. But in Ontario there is no evidence of any change in course so far.

This blog was originally published in Professor Mark Winfield's blog.

The run-up to the October 2011 Ontario election was defined by a strong and long-standing lead by Tim Hudak’s Progressive Conservatives. Polls over the summer of 2011 consistently gave the Progressive Conservatives margins in excess of ten per cent over the Liberals, and there were projections of strong PC majority government. Right wing-populist Rob Ford’s victory in the November 2010 City of Toronto mayoralty race and the strong showing of the federal Conservatives in Ontario in the May 2011 federal election reinforced expectations of a Progressive Conservative win at the provincial level.

Election night on October 6th yielded a very different result. Dalton McGuinty’s Liberals were re-elected as a minority government, with 53 seats, just one seat short of a majority. The Liberals received 37.6 per cent of the popular vote, putting them two per cent ahead of the PCs, who obtained 35.4 per cent of the vote and gained 37 seats. Andrea Horwath’s NDP made a strong showing with nearly 23 per cent of the vote, giving 17 seats. Green Party support, on the other hand, collapsed badly, with the party receiving less than three per cent of the popular vote and at 127,000 votes, little more than a third of the total vote it received in 2007. The Liberals and the NDP dominated in urban areas and the north, while PC support was concentrated in rural southern and central Ontario. The election saw the lowest voter turnout in Ontario history, at 49.2 per cent.

The Liberals, who ran a solid, consistent and largely-error free campaign, benefitted from a series of PC misfortunes and mistakes. The inability of Toronto Mayor Ford to find the promised “gravy” of wasteful spending at city hall and consequent proposals for profound and deeply unpopular cuts to city services in midst of provincial election campaign, along with a hopelessly ill-considered proposal to abandon well-advanced plans for revitalization of the city’s waterfront, did serious damage to the provincial PC effort. The situation in Toronto came be to perceived as foretaste, particularly in the city itself, of what a Hudak government, running on a platform very similar to Ford’s approach to the November 2010 Toronto election, might look like at the provincial level. In the result, the PCs failed to win a single one of the City of Toronto’s 22 seats in the legislature on election night.

PC leader Tim Hudak’s attacks, principally in response to a Liberal proposal for a modest tax credit for workers new to Canada, on “foreign workers” further undermined his party’s fortunes. The leader’s statements invited suggestions of racial intolerance on the part of the PCs. The effect was to push new Canadian and moderate voters away from the Tories, particularly in the crucial 905 region surrounding the City of Toronto, with its large population of first generation immigrants to Canada, denying the PCs any gains in the region.

Other factors worked against Tories as well. The outcomes of the 2010 Toronto municipal and 2011 federal elections prompted concerns over the possibility of a Conservative “trifecta” in Ontario at federal, provincial and municipal levels. There was also disquiet, particularly in urban areas, over the enthusiastic embrace of themes of the US Republican “tea party” movement by rural branches of the Ontario PC Party.

NDP, for its part, moved in a decidedly populist/materialist direction, proposing the removal of the HST from electricity, natural gas and gasoline prices as the centrepiece of its campaign. The party’s platform contained a number of important environmental elements, including opposition to new nuclear construction or refurbishment projects, a renewed focus on energy efficiency, increased transit funding, anti-SLAPP legislation, addressing the impact of the government’s ‘open for business’ initiative on the Environmental Bill of Rights, continued participation in the Western Climate Initiative, and action on waste management. However, the HST proposal, commitments to terminate the FIT program under the Green Energy Act and turn renewable energy development over to a resurrected Ontario Hydro, and an enthusiastic embrace of resource development in the far north led to suggestions that the party was wavering in its traditional support for environmental issues. Given the apparent electoral success of the NDP’s “pocketbook populist” approach and its gains in northern Ontario, the future positioning of the party on environmental matters may become increasingly contentious.

The Greens’ poor showing reflected the party’s struggle for space throughout the campaign. New leader Mike Schreiner put in a respectable performance, and the Greens again presented perhaps the most interesting platform of all of the major parties, including proposals for a modest carbon tax and a detailed strategy for sustainable agriculture and food. Unfortunately for Greens, the party found itself a victim of the overall eclipsing of the environment by economic concerns, with little more than three per cent of voters identifying environmental and energy problems as leading issues in the campaign.

Moreover, the Greens were squeezed by the Liberals’ emphasis on their Green Energy Act, especially its role in job creation and the risks of a PC government repealing the legislation. At the same time, the Greens received little benefit from the NDP’s shakiness on environmental issues, and were unable to exploit the Liberals’ inconsistencies on the environmental front, such as their continuing commitment, notwithstanding the Green Energy Act, to an electricity system that is 50 per cent nuclear in a post-Fukishima world. The situation was in part a result of the Green Party undermining own its appeal among voters seriously engaged on environmental issues. Such voters might have been put off by the Liberals’ inconsistencies and NDP’s vacillation on the environment, but may have found the elements of the Greens’ platform intended to attract anti-wind, anti-greenbelt and anti-source water protection voters in rural Ontario equally unappealing.

The Greens’ failures were perhaps even more surprising given that the Liberals presented a platform that was remarkably thin on new commitments on the environment and energy fronts. A vague promise to expand the greenbelt, an option first presented in the party’s 2007 platform, was the only new element. The remainder of the platform focused on past achievements and the continuation of existing initiatives like the Green Energy Act, transit funding and mining development in the far north. There have been suggestions that local opposition to Green Energy Act-inspired wind energy projects cost the Liberals a number rural seats, including those of environment minister John Wilkinson and agriculture minister Leona Dombrowsky. There is little hard evidence to support that hypothesis, and it is also likely that the Liberals’ strong focus on the legislation strengthened their appeal among younger voters.

The government seems likely to treat its re-election as an endorsement of its current path on the energy file. However, the divergence between those plans and the facts of the likely continuing decline in electricity demand, the uncertain availability and costs of nuclear projects, and the growing investments in green energy may hit sooner rather than later. Nuclear projects, aspects of the Green Energy Act and energy conservation efforts all have the potential to be victims in the resulting fallout.

The province’s fiscal situation means that the possibility of a serious financial retrenchment cannot be ruled out, even if the government’s narrow electoral success leaves it tempted to continue with its facilitative and managerial orientation. In reality, neither approach is likely to provide an effective response to the serious environmental and economic stresses now facing Ontario. The decline of the US market for Ontario’s exports, the difficulties for export-oriented value-added economic activities posed by a rising Canadian dollar driven by resource exports from western Canada, the regional impacts of climate change, the rural/urban split evident in the outcome of the 2011 election and the need to recover Toronto’s role as the anchor of the Greater Golden Horseshoe and as an emerging global city all present tests that will require vision and leadership as well as managerial competence. It remains to be seen whether Premier McGuinty’s renewed government will be able to meet those challenges.