December 16, 2011
PROVINCE RELEASES SECOND QUARTER FINANCIAL REPORT– – –
Unprecedented Flood has Major Impact on Province's Financial Projections: Struthers
“When the economic downturn hit, we made the choice to invest in protecting jobs and the services families count on most,” said Struthers. “When record flood waters hit this year, we promised Manitoba families that they won’t face this challenge alone either. But that’s resulted in hundreds of millions in unbudgeted expenses and it’s had an impact on our bottom line.”
The Quarterly Financial Report shows a projected deficit of $989 million, greater than the previously budgeted $438 million, due to significant costs in fighting the flood as well as other pressures such as public safety and corrections, and supports for families. The minister noted the costs of the flood are expected to hit $815 million by the end of the 2011-12 fiscal year.
“The costs of the flood have created financial challenges and we’ll be working to make adjustments and create efficiencies that will bring the deficit number down as much as possible,” said Struthers. “Manitoba is in year two of our five-year economic plan and we expect to return to balance on time by sticking to that plan. It’s a plan that’s kept our unemployment rate amongst the lowest in the country and our economy growing at better than the national average.”
The Mid-Year Economic Performance and Outlook shows that Manitoba has had a solid record of economic growth over the past five years, the highest among all provinces. Since Budget 2011, the medium-term economic outlook has weakened due to the impacts of spring flooding and the lower growth elsewhere in Canada and around the world. Manitoba’s growth is expected to improve, returning to the five-year average of 2.4 per cent by 2012, the minister said.
“We’re not through the woods yet. We will be listening carefully to Manitobans to make sure their priorities are top of mind when we present the spring budget,” said Struthers.
The minister noted, in the new year, budget consultations and meetings will be held in several Manitoba communities.
Both reports can be viewed at www.gov.mb.ca/finance/financialreports.html.