Manitoba deficit soars to $1.3 billion, PCs concerned about economic future

Manitoba's deficit has ballooned to $1.3 billion, a $513 million jump from its forecast earlier this year and raising alarm over the province's financial trajectory. 

The Manitoba Progressive Conservatives (PC) warned that the increased spending, revealed in the 2024-25 second-quarter financial update, could burden Manitobans with mounting debt and lead to potential credit downgrades.

According to the report, Manitoba's net debt is expected to reach $34.5 billion, or over $23,000 per resident, while annual debt servicing costs have risen by $69 million to $2.3 billion.

PC Leader Wayne Ewasko and PC Finance Critic MLA Lauren Stone criticized the NDP government for its "dismal financial performance."

"The NDP inherited the third-fastest growing economy in Canada, a $373-million surplus, and a clear path to sustainable balanced budgets," Ewasko said. 

"In just one year, they've squandered Manitoba's progress, putting us on an unsustainable path toward credit downgrades and tax increases."

The financial update also revealed troubling economic trends. 

Manitoba has dropped to seventh place among provinces in economic growth, unemployment has surged to 5.8%, and 7,600 more Manitobans are unemployed compared to the same time last year. 

Additionally, insolvencies are rising, with business bankruptcies up 32% and consumer insolvencies climbing 6%.

Adding to the strain are soaring living costs. 

Statistics Canada data shows Manitoba continues to lead the country in rising grocery prices, with fresh meat and vegetables increasing by 8.8% and 8.3%, respectively. 

Rents have also surged by nearly 8%.

Despite receiving $900 million in additional federal revenues, the government's spending outpaced its income, prompting Stone to criticize it. 

"Manitobans are struggling to make ends meet, and they deserve answers as to why the finance minister missed his own financial targets by over half a billion dollars in just six months," Stone said.

The PCs warned that the deficit will force the province to borrow more, driving up interest costs for future generations. 

With inflation and economic challenges mounting, the PCs are urging greater fiscal responsibility from the NDP government to safeguard Manitoba's financial future.