Ontario budget 2016: Service fees will rise with inflation

The elimination of the $30 Drive Clean fee grabbed the headlines from Thursday's Ontario budget, but the fiscal plan also contained increases in virtually every other government service fee, including vehicle registration.

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Starting next year, fees for driver and vehicle licensing, camping in provincial parks, fishing and hunting licences, liquor licences, event permits and court applications will be adjusted every year to keep up with inflation.

The government says automatic indexation will protect the sustainability and quality of the services, and ensure that the costs of providing them are borne by those who use and benefit from them.

"This is consistent with what many other jurisdictions already do," the government said in the budget.

But Progressive Conservative finance critic Vic Fedeli said the Liberal government is desperate for cash, and is making life more expensive for almost everyone by planning to increase service fees every year.

"When you're into that, you're really down into the couch digging for nickels and dimes," Fedeli said Friday. "And that leaves less disposable income for people, which means less consumer spending, which means fewer jobs."

The province raised $2.1 billion in fiscal 2014-15 from service fees, and plans to review all of them with an eye to making sure services intended to help low-income residents don't become more expensive.

"As the review proceeds, the government will continue to identify additional opportunities to update fees to remove hidden subsidies," declared the budget.

Thursday's budget also eliminated licensing fees for adoption agencies and increased the threshold for waiving fees for mediation in family courts.

Eliminating the Drive Clean fee will cost the province $60 million a year to pay private garages to conduct the emissions tests, and drivers will have to cover the cost of a diagnostic test if they fail and any repairs needed to bring the vehicle up to code.

Cars and light-duty trucks over seven years old must have an emissions test every two years.

The Trillium Automobile Dealers Association said eliminating the fee is a good first step, but it said the Drive Clean program has amassed a $50 million surplus and should be completely eliminated.

"The entire program is still a relic of the 1990s and does little for the environment," said Trillium spokesman Frank Notte. "The Drive Clean program is well beyond its best before date."