Health-care funding falls short
The province has projected health-care spending will grow at an average annual rate of 3.2 per cent from 2025-26 to 2028-29. The FAO says that is not enough: it estimates health-sector spending needs to grow by 4.4 per cent a year over the next three years just to maintain current service levels. The gap between those two numbers adds up fast, with the FAO projecting funding shortfalls of $2.0 billion in 2027-28 and $3.8 billion in 2028-29.
The practical effect, according to the FAO, is fewer resources on the ground. The number of funded hospital beds is projected to decrease by 2,407 from 2025-26 levels by 2028-29, and the number of provincially funded nurses is projected to fall by 2,522, from 157,062 in 2025-26 to 154,540 in 2028-29. The report also notes that Ontario already had the second-lowest age-standardized per capita health sector funding among Canadian provinces in 2023.
Education budgets shrink in real terms
On the education side, the Ministry of Education's spending is projected to grow at an average annual rate of just 0.6 per cent, from $42.7 billion in 2025-26 to $43.4 billion in 2028-29. The FAO estimates the ministry actually needs 2.1 per cent annual growth to hold current service levels, producing funding shortfalls of $0.7 billion in 2026-27, $1.2 billion in 2027-28 and $2.0 billion in 2028-29.
Real provincial operating funding to school boards is projected to keep declining on a per-student basis: $15,074 in 2026-27, $14,850 in 2027-28 and $14,775 in 2028-29. Child care funding is also under pressure. The FAO projects a Canada-Wide Early Learning and Child Care program funding shortfall of $0.3 billion in 2026-27, growing to $0.6 billion in 2027-28 and $4.8 billion in 2028-29.
Colleges and universities squeezed
The post-secondary sector fares worse still. Spending on colleges and universities through the Ministry of Colleges, Universities, Research Excellence and Security (MCURES) is projected to actually decrease, at an average annual rate of 2.2 per cent, from $13.6 billion in 2025-26 to $12.7 billion in 2028-29. The FAO says the sector would need 3.2 per cent annual growth to keep pace with need, leaving shortfalls of $1.7 billion in 2027-28 and $2.2 billion in 2028-29.
Students are expected to feel this directly: the average real Ontario Student Grant per full-time recipient at a public college is projected to decline to $2,269 in 2026-27. Ontario already had the lowest provincial funding among provinces for both public colleges ($9,460 per full-time equivalent domestic student) and universities ($10,516 per FTE domestic student).
What it means for Ottawa
If the trends the FAO describes hold, Ottawa families and patients are among those who would see the effects first through wait times, class sizes and tuition support.
Sources: Financial Accountability Office of Ontario (https://fao-on.org/en/report/estimates-2026-health/), Financial Accountability Office of Ontario (https://fao-on.org/en/report/estimates-2026-edu/), Financial Accountability Office of Ontario (https://fao-on.org/en/report/estimates-2026-mcures/)
