Ontario’s deficit is projected to be $14.4 billion in the 2012-13 fiscal year, Finance Minister Dwight Duncan announced Monday, $400 million lower than the government projected in the last budget.

Duncan’s announcement came as he delivered his fall economic outlook in the Legislature. The outlook provides an update on the provincial government’s fiscal picture at the midway point of the fiscal year.

According to the document, Ontario’s gross domestic product is projected to grow at a rate of 2 per cent this year, up from a forecast of 1.7 per cent in the spring budget. Economic growth is projected to be 1.9 per cent in 2013 and 2.3 per cent in 2014.

Duncan said the government is expecting higher revenues than it projected last spring, largely from more personal and corporate taxes, which will go toward tackling the deficit. But Duncan also looked to a wage freeze for public-sector workers to help balance the books by 2017-18, a strategy the Liberals launched with their spring budget.

The finance minister said Monday that the choice is between restraining wages and benefits, or laying off thousands of public-sector employees and potentially compromising services.

“It is fair and reasonable to ask all of our government workers to take a two-year wage freeze so that we can protect public services and, more importantly, save public sector jobs,” Duncan said.

Duncan acknowledged that the Liberal minority government needs the support of one of the opposition parties to carry on with its deficit-reduction strategy.

But PC Leader Tim Hudak stood up in the Legislature following Duncan’s address and immediately panned the report.

“I had hoped for much better,” Hudak said. “It was an unremarkable, unimaginative and unhelpful embrace of the status quo.”

Hudak then launched into a campaign-style speech, telling Duncan that Ontarians “want to see hope, they want to see opportunity, they want to see jobs,” and accused the Liberals of failing to revive the province’s private sector jobs market.

“Today’s economic statement should clearly have been an opportunity to debate action-oriented measures that reduce the overspending that is holding back Ontario’s engine of growth,” Hudak said, vowing that a PC government would balance the books before 2017-18.

NDP Leader Andrea Horwath told reporters afterward that the outlook, “provides more evidence that we need new ideas,” if the province is to eliminate the red ink, and help struggling families.

“More than ever we need to focus on creating new, good quality jobs, making sure that health care is there when we need it, and making life more affordable for hard-working Ontarians,” Horwath said.

Horwath said she understands the need for a wage freeze, but would prefer to see a negotiated settlement rather than an agreement enforced through legislation.