Canada has once again posted a bigger-than-forecast surplus, but this year there are several differences – ranging from how some of the billions were amassed to the way the money will be splurged.

Weeks before tabling his first federal budget Tuesday, Finance Minister John Manley confirmed that health care would be the document's main theme. The budget date itself was not set until a new medicare funding arrangement was announced by Prime Minister Jean Chrétien after meeting with the premiers earlier this month.

But the exact size of Canada's surplus this year, $9.4 billion, remained unclear, as well as how much would be allocated to each of a long list of initiatives outlined in last fall's Throne speech, including poverty, the environment, and urban infrastructure.

It's Manley's first budget, and Chrétien's last, and he's spending $6.4 billion of the extra money on new programs – launching Canada on one of its biggest spending spree in decades. The remaining $3 billion is being applied to the debt, leaving Ottawa with its sixth consecutive balanced budget.

Highlights include:

• $1.37 billion more for health care in the next year, on top of previously announced increases

• Immediate increase of $270 million to cover urgent Defence Department needs, such as Operation Apollo in Afghanistan;

• $800 million rise in the military's budget starting in 2003;

• $500 million increase in National Child Benefit over two years;

• $606 million on affordable housing and help for homeless over two years;

• Reduction in workers' EI payments by 12 cents to $1.98 per $100 of insurable earnings by 2004;

• Faster increase in RRSP contribution limits, reaching $18,000 in 2006;

• Drop in security charge on airline tickets to $14 from $24 for round-trips;

• Overall program spending up 11.5 per cent in 2002-03, and by an average of 4 per cent over the next two fiscal years;

• $507 billion federal debt, reduced $46.7 billion after five consecutive annual surpluses;

About $3 billion of the extra money Manley is spending comes from the adoption of "full accrual accounting," a system of financial records that spreads the full cost of some spending over several years.

As he traveled across the country asking people what they wanted in the budget, Manley said that tax cuts and paying down the debt were not the main priorities. He named this year's budget, "Building the Canada We Want."

"Canadians told us that the budget choices we make have to be about more than the tallying of accounts," Manley said in his speech to the House of Commons.

"Our choices must reflect the sum of our values. They must reflect Canadians' pride in their country and, above all, their hope and determination that their children will inherit an even better Canada and a better world."

During consultations, some groups had warned him against going on a spending binge. Last week, the C.D. Howe Institute urged him to concentrate spending on defence and health, while building a surplus that could be used for tax cuts and debt reduction.

But others, including the Centre for Police Alternatives, called for a big boost in government expenditure, arguing that after years of cuts Canada's biggest deficit is the amount it no longer spends on social programs.