Province projecting almost $1.6 billion deficit over next year

Manitoba's Finance Minister is revealing what is in store for the province's fiscal future, saying there will be significant financial challenges.

The government of Manitoba is sharing what they planning regarding the province's 2020-2021 needs, including facing the strong possibility of a $1.597 billion. This is lower than the initially anticipated deficit of $2.08 billion.

"It is going to take time to clean up this pandemic mess and we are facing that today with this budget," Premier Brian Pallister says in a Wednesday afternoon press conference.

 

Household changes

Finance Minister Scott Fielding is set to implement close to $34-million more towards the Department of Families, saying there is a prioritization in lifting Manitobans out of poverty.

“We will grow our way out of deficit and back into balance by investing in more jobs, tax relief and economic growth," Fielding says.

Founding increases include:

• nearly $4 million more for early learning and child care, with operating grants of $1.6 million to child-care centres supporting 392 spaces that opened over the past year, approximately 150 new spaces in capital projects opening over the coming year, plus 50 new home-based licensed child-care spaces
• an additional $22 million for Rent Assist and rent control guideline to be frozen through 2023
• $12.5 million increase for Community Living and disABILITY Services
• $2.56 million to support Manitobans experiencing homelessness
• nearly $2 million to pilot three new workforce training and support programs for Employment Income Assistance (EIA) program clients

Household tax removals include:

• phasing out education property taxes by 50 per cent over the next two years (25 per cent per year) for residential and farm properties, and 10 per cent for other types of property, with rebates returning nearly $250 million to approximately 658,000 property owners this year, and an average rebate of $1,140 over two years;
• removing the retail sales tax (RST) on personal services including haircuts and salon services as of December;
• reducing vehicle registration fees a further 10 per cent starting in July; and
• indexing Basic Personal Amount and personal income tax brackets to inflation so an additional 1,500 Manitobans won’t have to pay provincial income tax for 2021.

 

COVID-19 response

Anticipating a jump in COVID-19 vaccinations and projecting healthcare needs, $1.18 billion is being diverted towards pandemic needs.

“Even though we are not yet through the darkness of COVID-19, we must begin to plan for the light of recovery that lies ahead," Fielding says.

Plans include:

• $812-million capital confirmation for rural and northern health care under the multi-year Clinical and Preventative Services Plan;
• $50 million to reduce wait times for hip, knee and cataract procedures, and surgeries and services delayed by the pandemic;
• additional $23 million for cancer treatments and $2.7 million to expand dialysis;
• $9.3 million to add more than 120 personal care home beds; and
• continuous glucose monitor coverage for eligible children and youth under 25 and increasing insulin pump coverage to 25 from age 18.

Personal protective equipment (PPE), vaccine deployment, education supports, along with future needs are being budgeted for.

 

Workplace and education funds

With employment and education in mind, the government is looking to put tens of millions into development and retention. More than $62 million is set to be diverted to help businesses retrain employees and develop e-commerce platforms. There will be $25 million for youth job programs.

"Additional tax relief for small businesses includes lowering payroll tax thresholds to reduce rates for approximately 1,100 small businesses, exempting approximately 240, and enhancing or extending several tax credits in areas such as small business venture capital, interactive digital media and film production," the province says in a statement.

Kindergarten to Grade 12 and post-secondary infrastructure is set to be budgeted $415 million. Nearly $700 million will be going towards post-secondary education institutions. For the students themselves, an additional $4 million in bursaries and an additional $1.4 million in interest-free student loans are slated.

 

Justice Initiatives

The province says there will be

• $16.5 million to operate Manitoba’s new Public Safety Communications Service radio system;
• up to $2.9 million to fix the backlog in the courts system caused by COVID-19;
• additional $815,000 to increase supports for family violence and families of Missing and Murdered Indigenous Women and Girls; and
• $1.2 million in restorative justice initiatives for First Nations and Métis communities.

 

Infrastructure

The plan for construction and infrastructure including a "record $2.1-billion investment." Fielding's statement says this will create construction jobs and stimulate the economy.

The plan includes:

• almost $630 million for road construction and maintenance, including $107 million through the Manitoba Restart Program, which will allow safety improvements at the intersection of the Trans-Canada Highway and Provincial Trunk Highway 16 and the south perimeter interchange at St. Mary’s Road
• more than $292 million for health infrastructure including the new St. Boniface Hospital emergency department

• $103.5 million increase for priority strategic infrastructure projects that match federal funds under the Investing in Canada Infrastructure Program (ICIP)
• flexible basket funding to municipalities with $172.6 million in operating costs and $137 million in capital costs, with advanced operating grants again this year
• $25 million in trust to redevelop the Hudson’s Bay Building in downtown Winnipeg
• $5.6 million more for the Building Sustainable Communities Program to fund more than 10 larger-scale community capital projects