View From the Legislature

NDP Deficit Balloons to $2 Billion

  • Kelvin Goertzen, Author
  • Member of the Legislative Assembly, Steinbach

The last year end finances that were examined and signed off by the independent provincial auditor of Manitoba showed that the province had run a $250 million surplus for the 2022/2023 budget year. Given the various economic challenges that every government has been facing for the past several years, a budget surplus is both remarkable and important for ensuring that the finances of the province remain manageable.

Yet, a few things have changed since that independent report was released. Key among them, a new NDP government took over the financial controls about half a year ago. Since then, almost monthly, it seems that the provincial deficit just keeps getting higher. In fact, on Friday of this past week, the NDP government tried to quietly report that the provincial deficit for this year had grown to $2 billion.

Numbers this large are understandably difficult for most people to comprehend. To give it some perspective, the NDP deficit, which they have managed to accumulate quickly, is the largest projected deficit in Manitoba history excluding during the pandemic. That means that even during many of the relatively recent catastrophic floods that Manitoba has endured, the deficit was less than what the NDP are predicting this year.

How do the books go from a quarter of a million-dollar surplus one year to a historic deficit the next when there is no natural disaster to account for it? One factor may be that the NDP seem to be reverting to the pattern of previous Manitoba NDP governments when it comes to budget targeting. During their last tenure in government, it was a common occurrence that the budget deficit every year was much higher than originally predicted. In just the past three months alone, the projected deficit has increased by $300 million.

While the NDP will no doubt try its best to lay the responsibility for the deficit at the feet of others, the reality is that even during the time that they have been fully in control of the government since the election, their own projected deficit numbers have increased by hundreds of millions of dollars.

All of this will rightfully concern Manitobans who remember the record tax increases that occurred under the last NDP government because of the record deficits they ran at that time. That culminated with an increase to the provincial sales tax under the NDP. Now, the current NDP Finance Minister is indicating he is already speaking with credit agencies to try to ensure that this volume of NDP red ink doesn’t result in a down grade in the provincial credit rating which would result in paying higher interest rates on money borrowed.

While the NDP are incurring a huge deficit, in part to pay for their election promises, Manitobans are beginning to see higher taxes as their property tax bills begin to be received. With the blessing of the provincial NDP government, some residents are seeing their school taxes increase by almost 18% this year alone.

A historically high deficit combined with eye-popping tax increases. And the NDP have only been in power for six months. The upcoming April 2nd provincial budget has to show a proper balance between supporting crucial services while recognizing the financial crunch many Manitobans find themselves in. Up till now, the NDP seem only to be interested in spending your money, and hoping you don’t mind paying for it.