03/05/2014 10:51 EST | Updated 05/05/2014 05:59 EDT

Manitoba outlines how it will spend $5.5B on construction over five years

WINNIPEG - The Manitoba government has outlined how it will spend $5.5 billion — some of it from increased provincial sales taxes — to fix roads and bridges and boost flood protection over the next five years.

The governing NDP says the bulk of the money — $3.7 billion — is to go to roads and bridges. Another $1.5 billion is to be spent on municipal infrastructure, while $320 million is earmarked for flood protection.

About $1.5 billion is to come from extra revenue generated by an increase in the provincial sales tax to eight from seven per cent that the government brought in last summer.

"We could not be having this ambitious investment in infrastructure without this one cent on the dollar. Period," said Infrastructure and Transportation Minister Steve Ashton on Wednesday on the eve of the provincial budget.

"Manitobans wanted a significant investment in core infrastructure. They're going to see it. They're going to be able to see and feel and — with the amount of asphalt that we're going to be laying down — you're going to be able to smell the difference."

Ashton couldn't say how much the government had spent on infrastructure over the last five years, but added the $5.5 billion commitment does represent an increase.

"You're going to see a major, historic investment in core infrastructure."

The New Democrats have been floundering in the polls since they announced last year that they were increasing the provincial sales tax. The move came after the party had ruled out a tax increase in the previous election campaign.

The government had been struggling to clearly explain exactly where the extra revenue would go.

Economy Minister Theresa Oswald said it has been a "rough ride" and admitted it probably would have helped if the government had released detailed spending plans sooner.

The government released a report Wednesday, commissioned for $17,000 from the Conference Board of Canada, that touted the economic benefits of its infrastructure plan. The study found the infrastructure investments will create jobs, boost the economy and increase provincial exports, Oswald said.

"This plan is going to be very, very good to ensure that our trade corridors are solid and smooth and effective," Oswald said. "It's also going to boost other parts of our economy because, let's face it, Manitobans are going to have good-paying jobs."

But Conservative Leader Brian Pallister said the five-year plan is just a way for the NDP to justify its tax hike. He said the province should be investing in infrastructure but not by collecting extra provincial sales-tax revenue.

"You fund it through general revenues," Pallister said. "Every other province in Canada is facing many of the same infrastructure challenges. The infrastructure deficit is real. We need to invest in infrastructure. Every other province knows that. No other province raised the PST."

The government said the five-year plan is to be independently reviewed each year and the report made public. Ashton said the NDP hopes that getting shovels in the ground on construction projects will help convince sceptics that the tax increase was justified.

"If you prove that you get the results you said you were going to get, I actually think a lot of people will really take a second look at this," Ashton said.

"This is about the future of the province."

Note to readers: This is a corrected story. An earlier version said total of $5 billion was to be spent over five years and $3.4 billion was going to roads and bridges.