02/20/2014 01:00 EST | Updated 04/22/2014 05:59 EDT

Manitoba government says deficit this year is heading lower than expected

WINNIPEG - Updated budget figures show the Manitoba government's deficit is shrinking largely due to investment returns at Crown corporations.

The NDP government's third-quarter update released Thursday said the province is heading for a deficit of $432 million for the fiscal year that ends March 31 — $86 million lower than what was first predicted in last spring's budget.

The numbers mean the government is so far on track to meet its promise to balance the budget by the 2016-17 fiscal year — a target that has already been pushed back once.

"We are working to return to balance and we know the best way to do that is to keep steadily growing our economy," Finance Minister Jennifer Howard said in a statement.

"We also have to keep finding ways to reduce spending."

The updated figures include an extra $215 million from investment returns at Manitoba Hydro, the Workers Compensation Board and other Crown bodies. Another Crown corporation, Manitoba Agricultural Services, has spent $59 million less than expected, thanks to a very good farm year that required lower insurance payouts.

The government has also contained spending and is on track to shell out $64 million less than budgeted for previously announced programs. However, that was more than offset by a recent announcement of $100 million toward a settlement package for four First Nations communities that were flooded in 2011.

The government still has a way to go to meet its plan to end the red ink by the 2016 election year. The long-term outlook calls for a deficit of $365 million in the coming year and $164 million in 2015.

The NDP promised in the last election campaign to balance the books by 2015, but Premier Greg Selinger pushed back that date, blaming a sluggish worldwide economic recovery.

The government also confirmed Thursday it plans to table its new budget March 6 — the first day of the spring legislature sitting.