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In almost jubilant mood, Mr. Frost detailed 1945-46 refinancing to reduce interest and capital pay- ments on the Province's debt pay- able in United States funds and de- clared the $6,369,000 saving indi- cated the sound financial position of the Province and readiness of in., vestors to take Ontario issues. He explained details of refinancing $59,000,000 worth of earlier bond issues, which would have continued paying higher rates than the Prov- ince was able now to borrow. Ejxtensioiot hydro to 22,750 new rural customers. Increased allotments to assist mining, forest conservation, farm- ers of northern areas, and hos. pitals. l Increases, to Provincial Police to combat crime, including a three- Way radio system. - --- A - Overall increase in revenues dur- ing 1945-46 over previous estimates, including $24,000,000 trompp1or. Continuance of one-mill subsidy to municipalities. Plan for amortization of Ontario's present net debt, plus retirement of new indebtedness on a serial plan. Reduction of debt and interest payable in United States funds by refinancing. Announcement of a third consecu- 1ive net reduction. first time in Province's history. Highlights of the address in- eluded: Provision of 846,83T,800 for a vast highway program to repair wartime deterioration and build new roads. Assurance no new taxes would be levied, despite the estimated debt increase, for various reasons Including necessity of awaiting out- come of tax agreements before the Dominion - Provincial conference, Was made by Mr. Frost. He also revealed reductions during 1945-46 in the gross debt, net debt and in- terest costs, and increases in esti- mates to almost every department of government. Vast Highway Program A surplus from the past fiscal year's financing which allows Ontario to provide $5,800,000 aid to school boards on their imme- diate budgeting, and a forecast deficit for 194647 of $21,065,694 on ordinary account plus "a substantial increase in the gross debt," were announced by Provintrittles-------r-r-trr---r-- Treasurer Leslie Frost. In the 811-! Immediately following the Treat nual Legislature budget address ttrer's address, the Legislature wen yesterday. Ho pledged the deficit-- into committee of supply to pas based on record anticipated gross or- educational grants he had outlined dinary expenditures of $149,436,605 Premier George Drew, as Ministe o-will be overtaken from future or- of Education, recalled that Ml dinary revenue after the Dominion- Frost had revealed a surplus of 86 Provincial Conference. 7 052.000 that should be used to assis tlil Million for Roads In Provincial Budget Unexpected termination of the war, Mr. Frost said, permitted the Province to complete its fiscal year in much better condition than originally estimated. Revenues trom almost all sources had increased. due to an upsurge in business. Liquor revenues had totalled about six millions more than expected, due to lifting of Federal restric- tions and an increase in amount available for sale. In the face of increased commitments during 1945- Immediately following the Treas- ttrer's address, the Legislature went into committee of supply to pass educational grants he had outlined. Premier George Drew, as Minister of Education, recalled that Mr. Frost had revealed a surplus of $6.- 052.000 that should be used to assist school boards immediately with next year's financing. In a sense. " was an advance on next year's grants, being 20 per cent of the total to be paid. It thus permitted school boards to arrange their funds now without the need of borrowing from banks and adding interest rates to their costs. Cheques would issue immediately, the Premier said, and the House passed the grant. Wat's End Influence Mr. Frost stated that the com- ing year could still not be re- garded as a normal year and that Ontario would not probably see a normal year until 1947 or 1948 or later. His last Budget. he recalled. had been introduced under difficult cir- cumstances. Revenues had been re- stricted by reason of agreements entered into to help the Federal Government finance operations to help defeat the Axis. Ontario had undertaken financial obligations with regard to education which had no parallel in the Provinee's his- tory. committing itself to increase educational expenditures from about $15 million to $33 million. It had been inadvisable to increase taxes and yet it was essential to avoid increasing debt. "At that time." said Mr. Frost, "we had hopes that a Dominion- Provincial Conference would com- pletely clarify our financial posi- tion so that we might budget in a sound and proper way for a great- er Ontario."' 46. such as the (i;15,000,000 increase apportioned to education, this rev- enue increase had been important. On the other hand, numerous unex- pected expenditures had been nsceS- sary during the year, such as Ilk millions tor election costs, increases in salaries and staffs of hospitals. and $5,630,000 for urgent repairs to highways suffering from wartime traffic. hank al While the "sudden collapw of Japan had occasioned many large unanticipated expenditures. reve- nues had in some cases largely in- creased through demobiliration and raising of wartime restrictions. But Mr. Frost warned that the in- crease in revenues should not be taken as a permanency. Economy Practiced Preparations for a Dominion- Provincial Conference had been under way in Ontario since Aug- ust, 1943. he said, and during the past year the Treasury Committee had been in session almost con- tinuously. In this respect he laud- ed the Treasury Department staff as "a credit to themselves and their Province. ' . ." Mr. Frost said that, having chart- ed the Government's course a year ago. and, though the difficulties had been great, the Government. without stunting essential services, had practiced every reasonable economy and had given the tax- payers "the best possible value for their money." 'Revenues for the current year had exceeded the 1945-46 Budget forecast, with practically all de- partments showing increases. This, he thought. was "due to an up- surge of business activities due to an abundant supply of purchasing power characteristic of wartime and postwar conditions. He mentioned particularly rev- enue increases in liquor receipts (approximately $6 million), and in revenues from mines and the Pro- vincial Secretary's Department. Mines revenues were up about $900e 000 because, under legislation pass- ed last July, two years' mining taxes became payable during the year. Incorporation of new joint stock companies was largely re- sponsible, he said, for $600,000 extra revenue in the Provincial Secre- tary's Department. An explanation ot the $6 million increase in liquor revenues, Mr. Frost said, was to be found. in the progressive relaxation of war- time restrictions since last August through the Dominion Govern- ment's rescinding wartime regula- tions governing the supply of spirituous liquors. The removal of Dominion re- strictions had resulted in a four- fold supply of spirits becoming available as compared with a year ago. Will Suffer Reduction Estimating approximately $20 million revenue from liquor during the coming year, a $4 million drop from lam. year, Mr. Frost gave On. tario's liquor revenues for the past three years as.' 1943, $17,275,000; 1944, $20 million, and 1945, $18,713.- OOO, with the 1945-46 revenue ap- proximately $24 million. The Dominion revenue from liquor. including malt tax, in On- tario had been: 1943. $34 million; 1944. 832,600,000, and 1945, $36,- Turning to increased expendi- tures on ordinary account, the Provincial Treasurer said three out- standing items deserved special rnention--a $1M. million increase in the Attorney-General's department- al expenses due to the holding of the Provincial general election last June, $698,000 in the Health Dopam- ment largely because of increased salaries and staffs in Ontario men-