Manitoba premier vows to 'build, build, build' as trade wars loom large over next budget

Manitoba Premier Wab Kinew says his government's second budget will focus on building up the province as it contends with tariff wars on two fronts.

"If we're heading into a period where people are worried about the economy, what's the tried and true way of supporting jobs? It's putting people to work, building highways, building roads, building hospitals, building schools, building personal care homes," Kinew said Tuesday, in advance of the Thursday unveiling of his government's 2025-26 spending plan.

"There's going to be a lot of projects to just build, build, build, while we try and stabilize these economic uncertainties we're facing."

Kinew said the budget will account for the U.S. tariffs Manitoba is now facing and additional levies that may follow.

The budget plan will include two financial scenarios: one where tariffs are removed, and another where they persist and the province steps up with new financial supports for the economy and businesses, Kinew said.

"We've got to be there with flexibility, but most importantly transparency, so people see the economic plan is one that's real and it's going to help you."

The NDP government previously said businesses affected by the tariffs can choose to defer paying both the health and post-secondary education tax levy — commonly called the payroll tax — and the provincial sales tax for at least the next three months, starting with the February tax period.

The action is part of Manitoba's response to the evolving tariff threat from the U.S. Last week, President Donald Trump hit Canada with 25 per cent tariffs on steel and aluminum. Trump plans to implement additional levies on April 2.

In response, Canada retaliated with 25 per cent tariffs on $29.8 billion worth of U.S. goods.

Meanwhile, China slapped 100 per cent tariffs on Canadian agricultural products — including canola — in retaliation for 100 per cent tariffs on Chinese-made electric vehicles and a 25 per cent levy on Chinese aluminum and steel products that Canada imposed in October to match similar U.S. levies.

The economic fallout from these trade wars will make Manitoba's path to balance the budget by 2027 narrower. Balancing the budget in its first term was one of the NDP's promises during the 2023 provincial election campaign.

Even before the tariffs, the province said in December its projected deficit for the current fiscal year had ballooned by half a billion dollars, to a total of $1.3 billion, which it said was largely the result of overspending on health care.

The government has pledged to limit spending increases in future years to balance its budget, but hasn't articulated how it would do so, after overspending budget estimates in its first year, along with promising to hire more health-care workers and police officers and find homes for people living in encampments. 

The province must also find money to boost Manitoba Hydro's generating capacity, so the provincial Crown corporation can stave off a power shortage expected as soon as five winters from now. The utility faces billions in deferred maintenance costs and must make additional billions worth of investments in new power generation.