Finding the facts on budget 2026

On Tuesday afternoon, Manitoba finance minister Adrien Sala delivered the province’s budget for the 2026-27 fiscal year. Much of the media commentary immediately following Sala’s budget speech has focused on a handful of items the government wants the media to talk about — for example, removing the PST on all food sold in grocery stores, free transit fare for children and teens, and increasing the Renters Affordability Tax Credit. That commentary has missed a number of key points that only become clear after carefully reading all of the budget documents.

On Tuesday night and yesterday afternoon, I reviewed all of those documents, including the 147-page budget. While doing so, I found a number of important items that were not mentioned by Sala in his budget speech. Here are some of them:

The size of the deficit – During my time working for the province, I wrote or edited five provincial budget speeches, along with the technical documents that accompanied those speeches. I know a few things about Manitoba budgets, so it was a surprised to see that nowhere in Sala’s speech did he disclose the size of the deficit for the current (2025-26) fiscal year, nor the projected deficit for the upcoming fiscal year.

That’s basic information that should always be in a budget speech. The budget document forecasts the deficit for the current fiscal year to be $1.666 billion — far more than the budgeted $794 million — while the projected deficit for 2026-27 is $498 million. That’s an expected $1.168 billion improvement in just one year. Whether it is achievable leads to the next non-discussed issue.

Projecting a Manitoba Hydro profit – Sala’s speech does not discuss the fact that this year’s $1.666 billion deficit is due in large part to a $502 million loss at Manitoba Hydro, caused mostly by low water levels. Given that Budget 2026 expected Hydro to earn $220 million, the $502 million loss increases the 2025-26 deficit figure by $722 million.

This is the third year in a row that low water levels have hurt Hydro revenues, and yet Budget 2026 projects the utility will earn $140 million in the coming fiscal year. Given recent low-water history and the ongoing impact of climate change, that is a shaky estimate that could easily result in another half billion or more dollars being added to the projected deficit figure.

The cost of wildfires – The budget speech doesn’t disclose that last year’s wildfires caused the province’s emergencies expenditures to be $333 million over budget. Despite the likelihood of another tough wildfire season, Budget 2026 only sets aside $50 million for emergency expenses. As with the case of Hydro, the government is hoping rain will prevent a super-sized deficit.

Relying on federal transfers – The budget speech doesn’t mention that a whopping 36 per cent of the province’s revenues in 2025-26 came from federal transfers, nor that Budget 2026 projects those transfers to increase by more than $1 billion. If the government manages to balance the budget next year, as Sala promises, it will only be due to such huge transfers from Ottawa.

Unrealistic revenue projections – Budget 2025 projected $4.962 billion in individual income tax revenue, but missed that target by $161 million. Despite that shortfall and the current turmoil that threatens the economic health of the province and nation, the Budget 2026 document projects revenue from individual taxes to grow to $5.075 billion next year. That’s a risky bet.

All that debt – Manitoba paid almost $2.3 billion in debt servicing costs last year (including Hydro), and expects to pay almost $2.4 billion in 2026-27. Budget 2026 estimates that the province’s debt (excluding Hydro) will rise to $39,723 billion in fiscal 2026-27, but that figure rests on the assumption the government will achieve its $498 million deficit projection. The budget also projects Hydro’s debt to rise to $27.6 billion in the coming fiscal year, more than $2 billion higher than just two years ago.

Those numbers are important because the budget document also discloses that the province’s debt limit is $44.4 billion, while Hydro’s debt limit is $29.3 billion. We are quickly approaching the limits for both the province and Hydro, yet Budget 2026 says nothing about the looming crisis.

There is plenty for Manitobans to be concerned about in Budget 2026. Unfortunately, far too little of that information was contained in the budget speech and it is unrealistic to expect ordinary Manitobans to find the facts in the massive budget document, let alone comprehend the implications of that information.

Budget 2026 isn’t about cutting the PST on junk food and free bus fare for kids. It’s about a government that refuses to be frank with Manitobans about the finances of our province. A government that has consistently failed to meet its deficit targets and, instead of exercising any level of spending discipline, is recklessly relying on the weather to protect us from yet another bigger-than-projected deficit.