2011-2012 Resolution: Provincial Government Spending

Mar 25, 2011 | Chamber News

Preamble: In today’s globally competitive business environment it is imperative that government create a climate that attracts new business and also allows existing business to prosper. 

Various economic indicators have shown that Manitoba has continually lagged behind other provinces. Whether it is taxation levels, job growth numbers or average weekly wages Manitoba has not performed at an acceptable level. 

Business leaders have clearly told us that they don’t believe Manitoba’s business climate as competitive as it needs to be with other provinces. In an effort to achieve a more economically competitive climate in Manitoba business leaders have indicated that tax relief is a key component. The Only way taxes can be reduced however is though a combination of increased revenues and a reduction in spending. 

Resolution: That the Government of Manitoba: 

a) Create a culture in the public sector that encourages employees to continually look at finding efficiencies. 

b) Review all programs every year to determine where the payoffs are the greatest and identify areas where spending can be reduced or eliminated:

c) Establish a Commission on Efficiencies that engages the public in an effort to determine if the services provided by the Province are being done in a cost-effective and efficient manner; and

d) Consider the use of sunset clauses in all new program spending 

Resolution Report:  

The Manitoba Chambers of Commerce produces Resolution reports as part of its commitment to be accountable to its members. The reports are updated as matters unfold and have two components:

MCC Advocacy: Specific activities the MCC has done to help make this Resolution a reality. 

Developments:  All other information (e.g. government action, media coverage, reports) that relates to Resolution. 

Advice, comments, and information sharing are welcome; simply enter a reply at the bottom of this post.

MCC Advocacy: 

May 15, 2011: The 2011-2012 Resolutions were posted on the MCC website, listed as part of a comprehensive Report on AGM 2011 and then notice of this story was circulated through a news release as well as in an MCC E-Update which is sent to all MCC members, Media and Government.

June 22, 2011: Resolution books were sent to every MLA and every Member of Parliament that hails from Manitoba. The following had this Resolution specifically drawn to their attention with a detailed letter setting out the background to this issue, Government initiatives (where applicable), and an argument for the Resolution:

  • The Minister Finance


July 27, 2011:  The Honourable Rosann Wowchuk, Minister of Finance, wrote to the Manitoba Chambers of Commerce on this issue.

Here is her response:

The Honourable Rosann Wowchuk

I would also like to respond to the comments and the resolution on provincial government spending. When Budget 2010 was announced, the Canadian economy was facing the worst recession since the Second World War. Although a decade of balanced budgets put Manitoba in a strong position to address the global economic downturn, all Canadian governments, provincial and federal, went into deficit. As a result, we were faced with a choice of whether to cut services and balance the budget in a year and potentially worsen the economy, or to invest in infrastructure, create jobs and maintain vital front-line services. We decided to support our economy, put families first and not cut public services. 

Now one year later, Manitoba is on its way to recovering from the global economic downturn. Our Five-Year Economic Plan is delivering positive results and will continue to support the economy until the recovery is assured. Manitoba will maintain its responsible fiscal approach and return to balance in 2014. Budget 2011 maintains and expands vital front-line services that Manitoba families depend on and brings them closer to home. We also balanced these investments with significant and broad-based tax savings for families, continuing to make Manitoba an even more affordable place to live, work and raise a family. 

The Manitoba Chambers of Commerce believe that reducing expenditures must be a priority. As you may already know, an important component of our Five-Year Economic Plan calls for limiting growth of core government spending. In Budget 2011, overall expenditures are expected to rise by 2.3 per cent, which is in line with economic growth in Manitoba. The majority of new spending is directed to health, education and training, family services and justice.     

The Government of Manitoba is also demonstrating fiscal prudence through sound financial management of public resources, including:

  • A two-year pay freeze for the general civil service;
  • Freezing overall discretionary salary and operating expenditures for existing services government-wide;
  • Reducing ministerial salary levels by 20 per cent;
  • Continuing the second year of a freeze on salaries for members of the legislative assembly, their staff and senior government officials;
  • Freezing salaries for senior management in the regional health authorities; and
  • Continuing to find new ways to foster innovative and cost-effective services, such as results-based budgeting approaches and Lean Management techniques. 

Our record since 1999 also demonstrates this government’s ongoing commitment to fiscal prudence. In fact, this approach has earned the province six credit rating improvements in the last decade. Manitoba’s net-debt-to-GDP ratio, which measures the level of debt in comparison to the economy, is projected to be 26.2 per cent in 2011/12, much lower than the 32.9 per cent it was in 1999 and fourth lowest among provinces. In addition, the share of total revenue spent in debt servicing costs is forecast to be six cents of every dollar in 2011, which is down form 13 cents in 1999. 

The continued implementation of our Five-Year Economic Plan and our ongoing commitment to fiscal prudence will keep Manitoba moving forward and growing even stronger in 2011.

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