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Pallister blasts NDP for having no plan to tackle debt

By: Bruce Owen

Posted: 01/25/2013 11:37 AM | Comments: 0 | Last Modified: 01/25/2013 1:27 PM | Updates

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Progressive Conservative Party Leader Brian Pallister called on the NDP today to get serious with how it spends tax dollars before the provincial debt balloons further out of control.

"The willingness to admit a problem exists is essential before one can address it," Pallister said. "We don’t see the NDP addressing this problem, this spending problem, because they don’t acknowledge it as a problem."

Pallister said the current provincial debt sits at more than $27 billion. He said when the NDP took office in 1999 it was just over $13 billion.

He said when interest rates rise, even by just one per cent, they will lose $270 million a year towards servicing that debt.

He said the Selinger government needs a complete review of its spending with the view to cut it. Moves the NDP have made to date to amalgamate Manitoba Lotteries and the Manitoba Liquor Control Commission, plus merging municipalities under 1,000 population and trimming 600 civil service positions, have been ad hoc and unfocused, he added.

He also said in the past decade, when federal transfers to the province were high, the NDP failed to rein in its spending.

"This provincial government, having governed through the best financial decade in our province’s history in terms of -- not through their doing, but through circumstances outside of their doing -- has failed to manage expenditures and has actually managed to double the debt," Pallister said.

The province's net debt is now projected to hit 27.1 per cent of gross domestic product this year.

The province says compared to other provinces, Ontario’s debt to GDP ratio is significantly higher than Manitoba, and that Only Alberta, Saskatchewan and British Columbia have lower debt to GDP ratio than Manitoba.

Pallister said before Finance Minister Stan Struthers delivers his spring budget the Tories will release their own plan on where spending can be cut.

Pallister’s comments come after the Business Council of Manitoba released its budget recommendations, one of which called on the Selinger government to cut deeper into the civil service than the 600 positions already promised.

The council said more positions can be removed simply through attrition and by redeploying personnel.

Manitoba added 422 civil servants to the provincial payroll last fiscal year while racking up a record $999-million summary deficit. The number of government employees stood at 15,300 on March 31.

Just before Christmas, the Finance Department projected this year's deficit will hit $567 million -- $107 million more than it projected last spring. The government also admitted it would not be able to balance its books until 2016-17.

Core government spending -- projected to be $153.6 million higher this year than originally budgeted -- continues to be a problem, the business council said.

Struthers said earlier this week the province will not entertain deeper job cuts in the provincial civil service, saying that would threaten core public services.

The province says one reason for its financial predicament is because of the high cost of fighting, and the recovery from, the 2011 flood.

The province’s auditor general recently reported the actual 2011-12 deficit was $561 million greater than budget, the difference being a $437 million net loss due to the flood, and a $124 million net loss related to unbudgeted non-disaster costs; including in public safety, corrections and community, economic and resource development.

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Updated on Friday, January 25, 2013 at 12:54 PM CST: updates

1:27 PM: updates and adds fiscal charts from province

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