NDP will have to decide whether to make good on 2023 pledge or spend during election year

Manitoba's NDP government faces a critical decision as the province's deficit continues to shrink but remains substantial. The 2025-26 fiscal year saw a $832 million deficit, down from $1.12 billion the previous year and $1.95 billion in 2023-24. Premier Wab Kinew and Finance Minister Adrien Sala claim the NDP inherited a $2-billion deficit from the former Progressive Conservative government.

However, the actual figure is closer to $400 million higher than initially projected. Despite the deficit, the debt-to-GDP ratio has increased under the NDP, now at 36.4% compared to 34.6% in 2023-24. The NDP pledged in the 2023 election to balance the books by the end of its first term, but this will be a challenging goal in an upcoming election year.

Unless the deficit is significantly reduced, achieving a balanced budget may prove difficult, requiring either sharp spending cuts or substantial revenue increases. Both parties blame each other for the deficit, but the truth likely lies somewhere in between. The NDP's growing popularity makes it less likely that failing to balance the books would negatively impact their political fortunes.