WINNIPEG – Manitoba’s NDP government insists it didn’t break its promise to spend all revenue from its sales tax hike on infrastructure.
Last year the provincial sales tax was increased from 7 to 8 per cent, in what the Selinger government said was a necessary move to raise more money to spend on roads, bridges and other infrastructure projects. But a report released Tuesday shows the province is still sitting on $75 million dollars collected from the tax hike.
Manitoba’s finance minister said she didn’t expect to spend all the money right away.
“We heard form the construction industry this is great, but we need time to make sure we have the people hired, that we have the equipment and there is time to design projects,” said Jennifer Howard, the finance minister.
All the cash will be used over the next five years, she said, but critics said they aren’t confident that will happen.
“The same government that promised not to raise the sales tax is now saying trust us, we are going to put all this extra money into roads, it just doesn’t add up,” said Colin Craig, with the Canadian Taxpayers Federation.
Provincial officials said they did spend $115 million more last year on infrastructure than the year before.
Overall spending is up in the last budget by around four per cent, which is higher than inflation.
The annual public accounts report, also released Tuesday, shows the provincial deficit at $522 million, which is $4 million higher than forecast in the last budget.
“The government has a massive waste problem,” said Brian Pallister, the leader of the provincial Progressive Conservative Party. “It is overspending but it is not overspending in infrastructure. That’s clear.”
The finance minister defended her budget.
“We do spend more when the need is greater,” said Howard, who added the extra money went towards health care, among other departments.
Howard said she still expects to have a balanced budget by 2016-17.
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