11 Issue 2 Summer Edition 2019 BUILD MANITOBA 1  Total capital spend does not include Internal Service Adjustments 2  Capital spend is calculated using Manitoba budget Total Capital Expenditure, subtracting Internal Service Adjustments, Highways and water infrastructure. Highway infrastructure includes floodway expansion in years 2011-2014. Within Manitoba, the PBO found that the provincial government spent $544 million less on capital compared to the budgets for 2016/17 and 2017/18. This spending gap suggests that funding from the federal government resulted in a corresponding reduction in provincial investments after the IICP began. The report states that nationwide it appears the IICP has contributed to increased municipal capital spending, but not provincial capital spending. In fact, it appears provincial capital spending has been below budget since the IICP came into effect. Based on the PBO’s analysis, provincial capital spending across Canada was $3.8 billion lower than what it would have been in the absence of the IICP. The accusation of a lack of matched spending is serious. Public money is needed for building schools, hospitals, aged care facilities and other infrastructure vital to the public. A reduction in capital spending has real world implications for quality of life in Manitoba and construction business prospects. If this money is left on the table then there is important infrastructure left unbuilt. To determine if the PBO report is valid, we looked at the Manitoba capital spend based on the past nine Provincial Budgets.1 There is clearly a significant decline in the provincial investment into capital from 2011. In Figure 1, we can see a reduction of capital infrastructure spending2 reduced from over $264 million in 2011 to less than $99 million in 2019’s budget year. This analysis may be interpreted differently depending on your view of government spending and comfort level for public debt. The more fiscally conservative would applaud the restraint of the provincial government in its single-minded focus to reign in annual deficits – even if it means a reduction in infrastructure spending. However, others would be concerned about the reduction in new and improved facilities which make Manitoba a better place to live. The unwillingness to match federal dollars in institutional buildings does affect Manitobans. Ultimately, it is up to the elected government officials to deliver on their commitments to voters and manage their budgets how they said they would. With that said, in the future, WCA wants to see all levels of government work in concert with private industry to construct world- class buildings for Manitobans and our guests. Our members are the best in the business and are ready and willing to deliver the critical institutional infrastructure needed by Manitobans. Darryl Harrison, Manager, Policy & Research WE ARE SURETY SPECIALISTS theguarantee.com Excellence, Expertise, Experience … Every Time We work closely with brokers, clients, industry related associations, private enterprises and government bodies, to develop innovative surety bonding solutions that are responsive to existing and emerging business needs across Canada and the US.