Final number far below original projections of 10 to 30 per cent

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This article was published 4/5/2020 (533 days ago), so information in it may no longer be current.

After asking Crown corporations, universities and certain provincial departments last month to develop plans to reduce staff costs by 10 to 30 per cent, the Pallister government has settled on a figure that's far below that — 2.2 per cent.

Finance Minister Scott Fielding said Monday the government has identified $860 million (3.8 per cent) in overall spending reductions as it battles the COVID-19 pandemic and struggles to cope with an estimated budget deficit of $5 billion for the current fiscal year.

Government department spending will be reduced by 3.4 per cent ($509 million). Of that, $9.5 million (0.8 per cent) will be in the form of workforce spending reductions. 

There were no temporary public service layoff numbers announced Monday. The government said it was still negotiating various options with unions to minimize actual layoffs, including a possible work-share plan that would involve workers receiving EI payments.

"The cost of personal protective equipment alone could reach a billion dollars for Manitoba taxpayers." – Manitoba Finance Minister Scott Fielding

Government business enterprises, including Crown corporations, are expected to slash their budgets by a total of 3.8 per cent, or $177 million in total. That includes an 11.2 per cent cut in workforce expenses — or $95 million in total.

Meanwhile, other government reporting entities, such as post-secondary institutions and school divisions, are expected to trim total spending by one per cent or $177 million, including $89 million in workforce expenditures.

"Our No. 1 goal here was to find non-essential spending that we could pull and direct towards the front-line health-care providers," Fielding said in a teleconference call with reporters.

"The fact that we came in at a reduction of 2.2 per cent (in workforce costs) as opposed to 30 per cent, we think, is obviously a good news story because there isn't the reductions that initially we put forth as information."

Fielding said the government expects its 2020-2021 revenues to drop by $3 billion and its costs to rise by $2 billion. 

"The cost of personal protective equipment alone could reach a billion dollars for Manitoba taxpayers," he said.

Within core government departments, the government has found $500 million in discretionary spending savings, including conference and travel costs, to redirect to the fight against COVID-19, the finance minister said.

NDP Leader Wab Kinew called the $860-million spending reduction the largest single-day budget cut in Manitoba's history. He said the effect on services is "going to be felt right across the province."

Kinew accused the government of "hiding behind percentages and ratios" and not being forthcoming on the impact the cuts are going to have on jobs. He said within specific areas, staff cuts could still reach 30 per cent, although the government isn't telling.

"Why not just come out and tell us: here's how many people are going to get hit with layoffs; here's how many people are going to be hit with a salary reduction because of reduced workweeks. The fact that they're not telling us that suggests that this $860-million cut is bad news," he said.

Michelle Gawronsky, president of the Manitoba Government and General Employees Union, said she still doesn't know which civil servants will be affected by temporary or permanent layoffs three weeks after Premier Brian Pallister said cuts were coming.

"People are just panicking that they’re going to be out of work," she said.

Gawronsky said the MGEU has been able to work out arrangements with other public sector employers.

At Manitoba Liquor & Lotteries, some casino workers have been able to find jobs at liquor stores, she said. 

A number of employees at Manitoba Public Insurance have been temporarily laid off and are collecting federal benefits, Gawronsky said. Other MPI workers have been redeployed in other public sector roles, including the procurement and distribution of personal protective equipment, she added.

But so far, civil servants don't know where they stand, the union leader said.

larry.kusch@freepress.mb.ca