When Finance Minister Charles Sousa rises to deliver this year’s Ontario provincial budget, he’ll likely declare mission accomplished on slaying Ontario’s deficit. Indeed, after nine consecutive deficits and about $150 billion of new debt, we’ll likely see a balanced operating budget for the 2017/18 fiscal year, the first in a decade for Ontario.

What should Ontarians make of this? A return to budget balance would, of course, be good news for the most indebted subnational government in the world (even worse than California, the poster child for subnational debt). But it’s wildly premature to think this will in any meaningful way solve Ontario’s fiscal problems, or justify a return to the spendthrift ways of the previous administration.

Ontario’s finances have deteriorated so much in recent years that the work of repairing that damage begins, but does not end, with a balanced budget in 2017/18. Given Ontario’s enormous fiscal challenges, what’s needed is a sober recognition of reality and the development of a clear, realistic plan to address it.

For anyone who wants to celebrate the pending budget, here’s a reality check.

A balanced budget won’t undo all the fiscal damage caused by the long string of recent budget deficits. Those accumulated deficits (the sum of deficits over time), which have nearly doubled since 2008/09 and added to the province’s overall debt burden, will not simply disappear when the budget finally is balanced. All the resulting debt still must be serviced by provincial taxpayers.

Secondly, despite the fact that Minister Sousa will likely present a balanced operating budget this spring, his government will nevertheless continue to add new debt each year for the foreseeable future.

This may seem counter-intuitive, as many people assume that a “balanced budget” would mean no new debt. But that’s not the case. Why? Because the province separates capital spending from its operating budget for accounting purposes. Although it will stop adding new debt from spending on day-to-day operations such as salaries, programs and income transfers, it will continue adding new debt from spending on long-term projects such as roads and bridges.

And there’s no end to the borrowing in sight.

In fact, the government expects to add approximately $9 billion in new debt annually in the years ahead. As a result the province’s own Financial Accountability Office projects Ontario’s debt will climb to approximately $370 billion over the next five years.

Finally, precisely because the government will continue to add debt in the coming years, it’s unlikely to make much progress shrinking Ontario’s debt-to-GDP ratio, a metric that measures the burden of a government’s debt relative to the resources available in the economy to sustain that debt.

The Wynne government frequently stresses the importance of the debt-to-GDP ratio as a measure of the province’s fiscal health and states its commitment to bringing that ratio back to pre-recession levels (27 per cent of GDP).

Unfortunately, rhetoric about the importance of this objective has not yet been met with action. The government has yet to present a plan to meaningfully shrink the debt-to-GDP ratio, which is projected to hover close to its current historically high level of 40 per cent in the years ahead. Until significant progress is made on reducing this important metric, any claims that Ontario finances are back on track should be met with skepticism.

So when Minister Sousa tables Ontario’s budget in the coming weeks, Ontarians should keep the champagne on ice. A balanced operating budget will be welcome news but it’s only the first step in a longer process to repair the damage done to provincial finances. Much of the heavy lifting lies ahead.