Canadian Manufacturing

Manitoba PCs promise public-sector wage freezes to control debt

The province budget will include a number of measures to reduce debt, including unpaid days off and penalties for departments that overspend



WINNIPEG—The Manitoba government will deliver its annual budget April 11 and is planning a new way to keep ministers and departments from over-spending.

Finance Minister Cameron Friesen said the fiscal plan will contain tough but necessary decisions aimed at cutting the deficit.

The Progressive Conservative government has already cut spending in some areas since winning last April’s election and inheriting an $846-million deficit.

The number of cabinet ministers has been reduced, an agency that oversaw new roads on the east side of Lake Winnipeg has been folded and Crown corporations have been told to cut management positions by 15 per cent.

Friesen said more must be done to stop a string of deficits that started in 2010.

The government is promising a new law to control the cost of public-sector wages through options that could include wage freezes and unpaid days off.

Friesen said spending under the previous NDP government had been growing at a rate of four per cent a year.

“These actions placed our province on a path to even higher debt and increased debt-servicing costs as interest rates rise,” Friesen said in a written statement.

“This is the fiscal reality we are committed to addressing as we pursue both the discipline and commitment to services that Manitobans expect from their government.”

Premier Brian Pallister said he plans to introduce new mechanisms to ensure departments don’t blow their budget targets and hinted there could be financial penalties for those that overspend.

“The enforcement mechanism for a Manitoba small business that spends beyond its means would be bankruptcy. The enforcement mechanism for a Manitoban who spent radically more than they were bringing in in salary, would be that they would have to declare bankruptcy,” Pallister said.

“Having some consequences for people in the public service is only logical, fair and reasonable.”

Asked whether that would specifically involve pay cuts for ministers whose departments overspent, Pallister said to wait for legislation this spring.

“We have an ambitious legislative agenda. You’re going to see some legislation which may even well reference the idea you just advanced.”

The New Democrats have accused the Tory government of focusing on austerity measures that will hurt the economy and front-line services.

The Tories launched reviews of government operations last year, including a value-for-money audit of various programs and a study on innovations in health care.

The reports are being looked at by a task force led by former Saskatchewan finance minister Janice MacKinnon and Dave Angus, former head of the Winnipeg Chamber of Commerce.

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