Equalization payments from Ottawa to Manitoba are increasing by $337 million this year. However, this increase is less significant than that observed last year. Equalization payments now represent more than 15% of provincial government revenues.
An increase of 7.7% which increases federal equalization payments to $4.6 billion, an increase of 24% compared to the previous fiscal year.
Equalization is the Government of Canada's transfer program that addresses fiscal disparities between provinces.
This payment, provided by the federal government, allows lower-income provinces to have the funds necessary to offer their residents services of a comparable level, while maintaining similar tax levels.
The calculation to determine the amount of the equalization payment is complex. It takes into account in particular the capacity of each province to generate revenue.
When presenting the budget in March 2024, Manitoba Finance Minister Adrien Sala announced working on a gradual reduction of deficits, with the objective of achieving a balanced budget in 2027-2028, the last year of the budget. mandate of NPD.
We will analyze federal communication as we develop next year's budget
Mr. Sala said in a written statement.
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Manitoba Finance Minister Adrien Sala delivers his speech presenting the province's 2024 budget.
Photo: The Canadian Press / John Woods
The federal government's equalization payment represents more than 15 per cent of Manitoba government revenues, and its amount has fluctuated in recent years.
It was lower 15 years ago, under the government of former Prime Minister Greg Selinger, who then decided to increase the amount of the provincial sales tax.
The amount of equalization payments has increased in recent years, increasing by $840 million in the 2024-25 fiscal year, which ends in March.
The amount allocated for the 2025-2026 year is almost double that received by Manitoba for the 2019-2020 fiscal year.
With information from The Canadian Press
