Better-than-expected budgetary results in past two years Large and well-diversified economy Improved transparency in financial reporting Relatively small unfunded liabilities in public pension plans compared with peers Large net tax-supported debt burden Relatively limited financial flexibility Relatively large infrastructure requirements The ratings on the Province of Ontario reflect: Better-than-expected budgetary performances in the past two fiscal years (ended March 31), which are expected to continue in fiscal 2008. In its most recent budget, the province recorded a somewhat larger-than-expected operating surplus of 6.4% of revenues in fiscal 2007 (Standard&Poor's Ratings Services adjusted), following an operating surplus of 5.7% in fiscal 2006. This improvement represents a dramatic reversal from the string of deficits that started in fiscal 2003 and
