Manitoba deficit hits $1.3 billion

Manitoba's projected deficit has ballooned by half a billion dollars. A financial update Monday now projects the province to have a $1.3 billion shortfall.

The main culprit is over-expenditures in health care, which is leading to an audit of regional health authorities (RHAs).

The previous forecast was $796 million.

"While we've been able to make progress in reducing the deficit, there are challenges ahead," said Adrien Sala, the Minister of Finance, who was referring to the near $2 billion hole last year.

"We've got more work to do. There's always more work to do and continue to improve, but what we know is that this is a massive improvement over what we were left."

The health-care overruns came in at $438 million, with $230 million of that coming from RHAs.

The findings from the audits are expected to be shared in the new year with suggestions on how to save money.

"Most concerning is a culture of blowing past the budget that was not only seen as acceptable, but presumed to be unavoidable," said Health Minister Uzoma Asagwara.

Despite the increased numbers, Sala said the fiscal update is still good news, as it's a drop from last year's deficit, and Manitoba has 21,000 more jobs compared to this time last year.

"The second quarter report shows that we're not only making progress on reducing the deficit that we inherited from the PC government, but that the economy is also improving. All key metrics in the second quarter update have improved.," said Sala.

The opposition Tories, however, say the report shows the government is moving in the wrong direction.

"The reality is is that they have a spending problem and they're not sticking to their budget, which is exactly why we've seen their deficit grow," said PC Finance Critic Lauren Stone.

Other areas of overspending included justice, debt servicing, advanced education and training, and housing addictions and homelessness.

Sala said the government is still committed to balancing the books by the end of the term as well as reopening the Victoria Hospital emergency room.