Personally, I blame Mike Harris for this.
Back in the mid-1990s, as part of his "Common Sense Revolution," the provincial government took its responsibility for highways, assistance programs, and a constellation of other expensive things and forced it onto the cities and towns. This had the immediate impact of lightening the province's financial burden, which made it even easier for Harris to cut things elsewhere. Fifteen years later, we're seeing the consequences of that.
There's a reason you never hear of Toronto being deep in the red or dealing with the sort of punishing deficits that the provincial and federal governments currently have on the table - because Toronto is legally prohibited from running a deficit. Its budget must be balanced each and every year, and thanks to Harris and his ilk Toronto and other cities have a great deal more things to finance with a limited ability to finance them.
This has come to a head recently, with the city seriously looking at a 5% across-the-board cut in order to make some headway against a looming $500 million shortfall. There hasn't been any firm decision on what will be cut and how, yet; the other day the Toronto Zoo blatantly defied this, not only not cutting but adding 3.6% to its budget next year.
Of all the city's expenses, one of the single largest is the payroll. Apparently, budget chief Shelley Carroll has a plan to deal with this. According to the Toronto Star, she "hopes that staff reductions could be covered by attrition - not replacing people who leave."
This is patently ridiculous. The only time attrition ever works is when the volume of activity is dropping, and for a city government, there's alway something that will need doing. I can see not hiring new people, but refusing to replace ones who depart is something else entirely. Putting the responsibility for delivering city services on fewer and fewer overworked city workers is a recipe for problems, and it's not something that makes me envy a city worker today.