December 17, 2021
Manitoba Government Releases 2021-22 Mid-Year Financial Report
– – –Pandemic Continues to Influence Manitoba's Finances and Economic Recovery: Fielding
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The Manitoba government’s 2021-22 mid-year financial results show ongoing challenges and uncertainties related to the COVID-19 pandemic and its continuing impact on Manitoba’s economy, but also encouraging signs the province is turning a corner in its economic recovery, Finance Minister Scott Fielding announced today.
“Our government remains committed to a strong social and economic recovery with a focus on the health and well-being of all Manitobans, and these results show that we are moving in the right direction,” said Fielding. “We are seeing encouraging signs of economic growth along with the second lowest unemployment rate in Canada, although there is still uncertainty with the ongoing pandemic.”
The Manitoba 2021/22 Mid-Year Report – Fiscal and Economic Update forecasts a deficit of $1.123 billion, a $474 million improvement compared to the deficit of $1.597 billion projected in Budget 2021. Revenue is projected to be $18.327 billion, an increase of $489 million over the budget forecast of $17.838 billion. Higher income tax assessments for the 2020 tax year and stronger retail sales tax revenue are the driving factors in the forecasted increase. The increase in revenues is offset by lower net income of government business enterprises, in particular a forecasted net loss of $191 million by Manitoba Hydro.
Expenditures are projected to be $19.450 billion in 2021-22, $15 million higher than the budget forecast of $19.435 billion. Budget 2021 included $1.180 billion for COVID-19 response and contingencies. Almost $800 million of this funding has now been allocated to departments, leaving $381 million for the remainder of the year.
The provincial government has worked to ensure the economy rebounds and finances can withstand challenges, such as those brought on by COVID-19, the minister said. He noted the provincial unemployment rate is now at 5.1 per cent, the second lowest rate in Canada. Manitoba’s female unemployment rate of 4.5 per cent and youth unemployment rate of 8.7 per cent are also the second lowest in the country.
After losing more than 90,000 jobs during the peak of the pandemic in April 2020, the province regained 86,100 net jobs as of November 2021.
“Our provincial labour market statistics are encouraging, but we know there is room for improvement,” said Fielding. “The biggest risk to Manitoba’s economy continues to be the impact of the pandemic, especially the variants of concern, as it is in most other jurisdictions.”
Other factors influencing the economic outlook include a Canada-wide labour shortage and inflation, which rose to 4.7 per cent in Manitoba in October compared to the previous year.
Manitoba’s net debt to gross domestic product (GDP) ratio is forecasted to be 36.1 per cent in 2021-22, 3.8 percentage points lower than the 39.9 per cent forecast presented in Budget 2021. The improvement is due to the decreased deficit and the higher GDP outlook compared to Budget 2021.
To view the full 2021-22 mid-year financial report, visit www.manitoba.ca/governmentfinances.
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