Provincial govt. puts off balanced budget until 2018

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This article was published 24/04/2015 (4063 days ago), so information in it may no longer be current.

The target date for the Manitoba government to be back in the black has been pushed back a year.

Again.

 Finance Minister Greg Dewar said today the Selinger government will need another year to eliminate the budget deficit.

The target date had been 2016-17, but Dewar said today the government is now eyeing the following year to return to a budget surplus.

Dewar said global economy is still weak and that now is not the time to drastically reduce spending.

“What I heard from industry loud and clear is that we can’t take our foot off the gas right now,” he said. “That would be disastrous for our economy.”

Dewar introduces his first budget as finance minister next Thursday.

Manitoba has run deficit budgets since 2009 in response to the recession, and to spur growth and employment.

The government had originally promised to be back in the black by 2014-15.

According to the province’s second quarter financial report, released in December, the government is on pace to post a $402 million deficit this fiscal year, $45 million higher than forecast last spring.

The higher deficit was forecast despite the fact that revenues have exceeded expectations. The government says its core revenues are $129 million higher than budgeted due to the recovery of certain past flood related expenses from the federal government and a one-time accounting adjustment related to pensions in the Manitoba Liquor and Lotteries Corp.

Spending this fiscal year is projected to be $164 million higher than expected, mainly due to costs related to the 2014 flood.

The deficit for the 2013-14 fiscal year was $522 million – $4 million higher than budgeted.

The slow pace of reining in the deficit has seen Moody’s Investors Service downgrade the outlook for Manitoba’s Aa1 debt rating to negative from stable.

Dewar said that due to the involvement of government Manitoba is projected to have the strongest economic growth in Canada over the next two years and currently has one of the highest wage and employment rates in the country.

He also said at the same time the government has slowly reduced its deficit, but under current circumstances needs another year.

“Our employment is going up and our deficit is coming down,” Dewar said. “Every year since the great recession of 2009 our deficits are getting smaller here in the province.”

In Ontario’s budget, introduced on Thursday, Premier Kathleen Wynne’s government will post a $8.5 billion deficit with a 2019 target date to be back in balance.

Alberta, under the campaigning Conservative government of Premier Jim Prentice, is posted to run a $5 billion deficit this year followed by a $3 billion deficit in 2016-17 before new revenue and cuts start paying off with a $709 million surplus in 2017-18.