Lawsuit settlements, drop in Hydro revenue push Manitoba to nearly $2B deficit

Manitoba's government posted the largest non-pandemic deficit in the province's history in 2023-24, sitting justunder $2 billion for the fiscal year that ended in March, new documents show.

The final audited results for the 2023-24 fiscal year show a major factor was a drop in revenue from Crown-owned Manitoba Hydro, with dry weather and low water levels turningan expected profit into a loss.

On the spending side, new collective agreements in the public sector and a lawsuit settlement over payments to kids in the child welfare system drove up costs.

Manitoba has run deficits every year but two since 2009, and the NDP government has promised to balance the budget by 2027.

Finance Minister Adrien Sala says the government is undertaking a review in order to meet that target.

"We put out a budget for this year that set the path to that balanced budget in our final year," Sala said Friday."It shows already important decisions that we're making to bring our deficit under control."

The province is getting some help this year in the form of equalization payments from the federal government, which are rising by 24 per cent, or $840 million.

Wayne Ewasko, interim leader of the Opposition Progressive Conservative Party, said ina statement that"[Premier]Wab Kinew and the NDP went on a post-election spending spree that has primed the pump for tax hikes and large deficits for years to come."

But Sala said the NDP government inherited the current deficit from the previous PC government.

"The last government did not manage the books responsibly. They left us with a $2-billion deficit," he said."That's a big hole that we have to climb out of collectively."

Sala said his government is "focused on managing our books responsibly, and we're gonna deliver on that."