Ontario’s 2026 Budget is the latest in a series of significant provincial deficits shaped by geopolitical change and shifting global investment flows. With a projected $13.8 billion deficit, the province is betting that long-term infrastructure investment and modernization across critical sectors, including information technology, life sciences and advanced manufacturing, will produce stable economic growth and a return to surplus by 2028-29.
In its 2026 pre-budget submission, TECHNATION urged the government to advance responsible AI adoption across the public and private sectors, invest in data and digital infrastructure, modernize procurement practices, strengthen the digital health agenda, and build a workforce pipeline aligned with the demands of a technology-driven economy. Budget 2026 responds to a number of these priorities in material ways, and TECHNATION offers the following assessment of where the province is moving in the right direction, and where continued ambition is warranted.
Ontario enters this strained fiscal period with a distinct advantage: a world-class technology and innovation ecosystem anchored by deep AI talent pools, globally leading research institutions, and a growing base of SME technology firms. Budget 2026 reflects an intentional effort to activate that advantage, positioning technology as a primary lever for economic recovery, productivity growth and long-term competitiveness.
AI Adoption
TECHNATION has long advocated for a comprehensive, outcome-oriented approach to AI adoption that pairs targeted investment with sound governance. The province’s AI Industrial Strategy, set to launch in summer 2026, and a renewed $107 million investment in its Critical Technology Initiatives program targeting AI, quantum technologies, cybersecurity, advanced connectivity, and semiconductors are important steps in this direction. AI adoption could generate $122 billion in real GDP for Ontario between 2025 and 2035, create an average of 17,600 jobs annually, and boost labour productivity by 1.6 per cent by 2035. The Enhancing Digital Security and Trust Act, in effect since January 2025, attempts to position Ontario as a leading Canadian jurisdiction for AI governance, providing the transparency and accountability frameworks that responsible adoption requires across both the public and private sectors. TECHNATION encourages continued and structured consultation with Ontario’s technology industry, with monitored outcomes and achievable milestones to ensure that these commitments translate into swift and effective delivery.
Talent and Skills
TECHNATION recommended that Ontario align post-secondary investment with in-demand technology programs and build concrete pathways for reskilling workers. The AI Industrial Strategy’s commitment to Ontario-made technology and talent, AI literacy, and clear governance frameworks reflects the direction TECHNATION called for. Ontario should follow through with a concrete reskilling plan, expanded access to applied digital education, and strengthened co-op and work-integrated learning pathways. Aligning post-secondary capacity with real-time labour market signals will determine whether Ontario’s talent pipeline keeps pace with the economy the province is working to build.
Procurement
On procurement, TECHNATION suggests the priority must be building best-in-class technology ecosystems that create quality services for Ontario citizens, strengthen Ontario businesses and encourage broader economic growth. TECHNATION’s membership includes many Canadian firms and proud global investors in Canada’s technology industry. We believe Canadian companies can prosper under domestic procurement, independently and as part of strong and secure technology ecosystems. As the government advances its domestic procurement focus, it must ensure that purchasing decisions align with existing infrastructure and established tech ecosystems, rather than creating narrow, prescriptive environments that fragment delivery and complicate administration. Canadian content should be a meaningful consideration embedded within bids and evaluated as part of overall value, and should not be implemented in a way that limits access to best-in-class solutions or drives inefficiency. TECHNATION will continue to advance procurement solutions that will support Ontario in its effort to stimulate domestic economic growth, while positioning the province as a best-in-class jurisdiction for technology service delivery.
Digital Health
With a long-standing call to strengthen Ontario’s health data ecosystem through improved interoperability and secure access to essential digital tools, TECHNATION is encouraged by Ontario’s advancement of a provincewide electronic medical record for primary care. The Primary Care Medical Record system is designed to replace thousands of isolated chart systems with an interoperable, secure platform that provides healthcare workers with timely access to comprehensive health information, reducing delays in care, eliminating duplication of tests, and improving the security of patient records. TECHNATION encourages a procurement process that draws on the expertise in Ontario’s domestic health technology sector, prioritizes privacy from the outset, and is structured to deliver results at the pace the health system requires.
Ontario’s Tech Future
Taken together, the depth of Ontario’s technology agenda across AI governance, data sovereignty, procurement modernization, health digitization and workforce alignment creates a credible pathway for future fiscal prosperity and generates real demand for the ICT sector to deliver technology solutions at scale. TECHNATION looks forward to working with the Government of Ontario to advance a more innovative, digitally enabled province.
