Drip, drip, drip.
That was the sound NDP Finance Minister Greg Selinger was hearing after his meeting this week with his provincial and federal counterparts where he learned that the tap was being closed on ever increasing amounts of cash from Ottawa.
After years of massive increases to federal equalization handouts from Ottawa to Manitoba, the well is running dry. Last week it was confirmed that Ontario had entered the status of a “have-not” province as a result of significant challenges in their automobile manufacturing industry. With Ontario drawing from equalization payments instead of contributing to them, it means there is less for Manitoba.
In fact the federal government has indicated that there will be no increase to equalization payments to Manitoba next year. Instead the province will receive no more than it did this past year. That will be hard news for the NDP government to swallow. Gary Doer has banked on ever increasing amounts of handouts from Ottawa through equalization without ever giving any thought toward building a provincial economy that is less reliant on money from wealthier provinces and the federal government.
Since being elected in 1999, the NDP has increased spending on government programs by more than 40%, from $6.8 billion to $9.8 billion. This has been possible not because Manitoba’s economy has grown by 40% but because other provinces have grown more wealthy and under Canada’s equalization program, that wealth is shared.
In 2000 the NDP government was receiving $1.56 billion annually in transfer payments from Ottawa. That has since grown to $4 billion a year.
Gary Doer and the NDP have done very little to grow our own economy over the past eight years but they have been very good at spending the money that has come their way from the growth of the economies of other provinces.
But with that growth slowing and in some cases contracting, the NDP won’t be able to just wait for the cheque from Ottawa to arrive in the mail in order to make ends meet in Manitoba. They will be responsible for actually building a real economic base in Manitoba that doesn’t rely so heavily on handouts from Ottawa and other provinces.
Ironically, Saskatchewan and Newfoundland, two of the provinces that relied heavily on transfer payments from Ottawa in the past, were proudly boasting last week that they had moved into the category of “have” provinces and would not require any equalization payments. That comes as a result of years of building their local economies.
As a result of Gary Doer and the NDP taking the easy money over the past eight years, they now will be faced with some tough decisions as the money slows. These decisions will impact all Manitobans. Meanwhile, we are left to look at the growing economies of Saskatchewan and Newfoundland and wonder what might have been if only the NDP government had taken the right steps and not just the easy money over the past eight years.