Manitoba's deficit lower than predicted: budget update
Province says it is expecting to accumulate a deficit of $325 million
Manitoba's deficit is running a bit lower than expected.
In a third-quarter update for the fiscal year that ends March 31, the government says it is expecting a deficit of $325 million.
That's $35 million lower than predicted in last spring's budget.
While the economy is growing more slowly than expected, corporate income tax revenues are running higher, the government update said.
The province also is spending a lot less in areas such as housing and education.
Finance Minister Scott Fielding has promised to balance the budget and end a decade of deficits before the next election, which is slated for 2023.
He told reporters Tuesday the province is not out of the fiscal woods due to the debt-servicing costs that exceed $1 billion a year.
In the fiscal update, the province expects real gross domestic product to increase at a rate of 1.3 per cent this year.
That's more optimistic than the projection issued last week by the Conference Board of Canada, which expects the Manitoba economy to grow by 0.9 per cent in 2020.
The fiscal update noted the 2019 ban on canola-seed exports to China led to a 54 per cent reduction in exports to the world's largest economic power. But Chinese trade tensions did not take exports down overall.
"This was more than offset by a 9.4 per cent increase in sales to the US, resulting in a 2.6 per cent gain in total international merchandise exports from Manitoba," the report stated.
Fielding said Manitoba is in a good position to weather future economic storms, including the potential effects of COVID-19 on worldwide trade, as he asserted his government has typically outperformed revenue-and-expenditure projections in previous years.
With files from Bartley Kives