Toronto Mayor Olivia Chow during an event on the ground floor of the still-under-construction One Bloor West in Toronto, Ont., June 22, 2026. (Credit: Peter Power/Postmedia files)
In the election campaign ahead of Toronto’s municipal vote in October, the high and increasing cost of city hall should be a major issue. Since becoming mayor in 2023, Olivia Chow has raised property taxes by 19.6 per cent and made both the vacancy tax and municipal land transfer tax more punitive. And while Torontonians were being hit with higher taxes, spending has spiked.
For example, according to the auditor general’s recent report, after 2024’s relatively modest 3.5 per cent annual increase in staff overtime costs, in 2025 they rose from $113.2 million to $134.2 million, an astonishing 18.5 per cent. Similarly, while staff sick leave costs grew by 3.6 per cent in 2024, in 2025 they rose from $113.0 million to $131.9 million — 16.7 per cent.
The auditor general also found that in 2025, staff “standby costs” (for employees who are off-duty but must remain available to work if required) increased 18.0 per cent to $10.3 million, while staff “callback costs” (employees called back to the workplace outside of scheduled shifts) increased 64.2 per cent to $1.6 million. The dollar amounts involved here are smaller than for overtime pay and sick leave, but they follow the same pattern of rapid growth.
One possible justification for the sharp jump in staff overtime costs might be that circumstances demanded it, such as a significant increase in fires causing more overtime costs for the fire department. But that can’t explain why, for instance, the “Parks and Recreation” division hiked its overtime costs from $6.6 million in 2024 to $9.7 million in 2025 — nearly 50 per cent. Parks and Recreation also increased its full-time staff by approximately 10 per cent last year, so it can hardly be said to be short-staffed.
Finally, the auditor general found that the “Attendance Management Program,” which is the city’s policy regarding employee attendance and absenteeism, is based on historical averages established back in 2001, has not been updated since then and is managed at the divisional level so “there is no centralized tracking or oversight of the program’s outcome and effectiveness.” According to the December 2025 attendance management report, “City-wide average absenteeism was 9.48 days per employee, approximately 18.5 per cent above the City’s eight-day standard.”
Clearly, city hall could do a much better job managing taxpayer money. And not just regarding city staff.
Municipal construction in the industrial, commercial and institutional sector is subject to closed bidding, which means only certain unionized shops can bid. According to a 2023 study by Cardus based on evidence from other Ontario municipalities that have opened construction bidding to wider competition, Toronto’s anti-competition policy cost taxpayers an estimated $347 million that year.
Toronto’s municipal climate-change subsidies — including energy retrofit loans, Indigenous and youth grants, and energy efficiency rebates — add yet more unnecessary costs. Studies show that these kinds of subsidy programs deliver nowhere near the environmental benefits required to justify the costs.
Unfortunately, instead of trying to manage taxpayer money better, city hall is running in the opposite direction. Earlier this year, city council passed a motion to open four government-run grocery stores, an idea that defies common sense. Grocery profit margins are in the low single-digits, which means that even if city hall operates stores as efficiently as the most efficient private business, shoppers would only save about three per cent on groceries. And even these meagre “savings” would be fake. Toronto taxpayers would have to put up millions of dollars to establish stores that earn zero return on this capital while taking massive risk.
As October’s municipal election approaches, Torontonians should demand better from their politicians. Taxes are too high because spending is too high.
Regular columnist Matthew Lau is an adjunct scholar with the Fraser Institute.