POLITICS

Manitoba deficit for last year at $999M, more than double original forecast

09/28/2012 01:04 EDT | Updated 11/28/2012 05:12 EST
WINNIPEG - Manitoba's NDP government says it registered a $999-million deficit last year due largely to severe flooding but also to spending jumps in many departments.

"It was quite a year, 2011-12. A lot of Manitobans were challenged and so was our budgeting," Finance Minister Stan Struthers said Friday after releasing the final tally for the fiscal year that ended in March.

"It was an unprecedented flood with an unprecedented price tag."

The deficit was more than double what the government originally predicted. Two-thirds of the red ink was due to flooding in the spring and summer of 2011. Rising rivers and lakes forced thousands from their homes, swamped farmland and prompted emergency dike work in much of western and central Manitoba.

But the departments of justice, housing and community development, among others, saw their spending increase as well. Struthers said there were extra demands from people in need and the government decided not to cut services.

"Those departments deal with some of the most vulnerable people in Manitoba society. We can't turn away kids when they need our help."

The Opposition said the figures prove the government has lost control of its spending.

"A billion dollars added to Manitoba's debt is just unforgivable," said Reg Helwer, acting finance critic for the Progressive Conservatives.

"We're going to be paying this back for generations to come."

Overall spending was $14.8 billion — $995 million more than budgeted and $1.4 billion more than the previous fiscal year, according to the figures.

On the plus side, revenues totalled $13.8 billion — $434 million more than predicted. The increase was due largely to a $31-million jump in sales tax revenues and $135 million more than expected in user fees and other non-tax income.

While the flood is over, Struthers's budget woes are ongoing. When he tabled his budget for this year, it forecast a deficit of $448 million. To achieve that figure, Struthers has promised to sell $80 million in government assets and find $128 million in day-to-day program savings.

With the fiscal year half over, Struthers has yet to say exactly where those savings will be found. He said Friday he was still working on it.

"We're going to come back next week with some more detail on this, but what I can tell you is that we're about halfway there."

When pressed for an example, Struthers said the government has decided to postpone "Manitoba In Motion" television ads that encourage people to be physically active.

"We think we can save $300,000 by putting that on pause. Those are the kind of things that we've been taking a look at."

Note to readers: This is a corrected story. An earlier version said Struthers is looking for $211 million in day-to-day savings.