Manitoba Budget Aims to “Rebuild Health Care” with a Record 14.2% Increase

 

March 21, 2025 – On March 20, 2025, the Manitoba government presented its 2025/26 budget, forecasting total spending at $25.6 billion. The government has included $1.1 billion in contingencies and projects a deficit between $796 million and $1.9 billion.  Despite the mounting economic pressures from tariffs, the government is prioritizing a “rebuild” of the health care system with a record investment of $9.38 billion, an increase of 14.2% from the prior year.

Initial Insights

• Rebuilding Manitoba’s Health Care a Top Priority: Health care was Manitoba’s top spending priority, with a record $1.2 billion increase  (14.2%) in the total budget for health, seniors, and long-term care. This represents over 70% of the total new spending in the 2025/26 budget.
  
• Health System Rebuild Centered on Workers: The government says that 70% of the new health spending will go directly to health care workers. In the past year, the government has recruited 1,255 net new health care professionals to the province. The government has also signed a flurry of new agreements with health professional colleges and unions, resulting in increased wages across the board. 
• Record Capital Investment: The government announced $3.7 billion in new capital investment projects, including $660 million for health care projects. The majority of the funding will be used to expand Manitoba’s highways and improve hydroelectricity infrastructure.
  
• Planning for Tariffs: The provincial government announced they would reserve $1.1 billion in contingencies to address the ongoing tariff conflicts with the U.S. and China. $500 million would be used to support businesses and farmers directly.

Health Care Highlights

Health System Rebuild Centered on Workers

The Manitoba budget highlights the government’s commitment to building a better health care system with a robust increase of $1.2 billion in spending from the prior year. The majority ($770 million) of this new funding will go directly to frontline staff, who have seen a dramatic increase in their wages through a series of new wage agreements (link 1, link 2). The government’s work has yielded quite a lot of success in its first year, surpassing its own recruitment goal with 1,255 net new health care professionals entering the system within the past year. 

The government will attempt to continue the workforce momentum by dedicating $48.2 million to creating 176 new health care training seats across the province, including 20 new physician residency spots, 40 lab and X-ray technician seats, and 100 health care aides in northern Manitoba. 

Keeping the Pressure on Health Authorities

Manitoba health authorities have been in the news lately for internal issues with spending and culture. The budget forecasts health authorities had an over-expenditure of $250 million in 2024/25. The government does not shy away from these issues in the budget document, challenging health authorities to build a better culture for the staff and stronger mechanisms for oversight of investments. The government will need to trust that these changes will happen rapidly, as they have increased funding for health authorities by 17.6%. 

Capital Spending Modest but Impactful

While the government announced a robust total capital spending plan of $3.7 billion, new commitments within health care encompass $660 million. The majority of this spending will be focused on renovating emergency rooms at hospitals across the province, including Victoria General Hospital, Eriksdale, and Children’s ER. This funding envelope also includes $94.5 million to build three new personal care centres. Finally, the government announced they will begin the design phase of a new CancerCare Manitoba Headquarters in Winnipeg. 

Drug Plan Sees Mild Expansion

The pharmacare budget will increase by $16 million (3.6%). The government announced the formulary will increase coverage for HIV medications, intravitreal drugs, and cancer drugs through the Home Cancer Drug Program. 

Women’s Health Focus

The government announced a number of initiatives aimed at improving the quality of women’s health services. These include lowering breast cancer screening to 40 years of age and specific targeting of Black, Indigenous, and People of Color (BIPOC) communities to address inequities in screening. The government also committed to expanding the province’s free birth control program to include Plan B. 

Other Health Care Commitments 

• A 13.5% increase in the  Provincial Health Services budget with a significant increase to blood transfusion services (14% increase), and immunizing agents, biologics, and drugs (91% increase). 
• Adding 97 beds to hospitals across the province, bringing the government’s total to 330 beds over their first two budgets ($47 million). 
• $55 million increase for diagnostic and surgical services across the province. 
• Three new primary care clinics in 2025 with the exact locations to be announced. 
• $40 million to provide more direct care hours to seniors. 
• $11.5 million in funding to begin design on a new CancerCare MB HQ in Winnipeg. 
• $50.4 million in electronic medical patient records to improve patient care. 
• New plastic health cards, including individual cards for children and youth. 

Other Notable Budget Commitments

A Robust Capital Spending Budget of $3.7 billion

• $414 million to complete building phase 2 of the North End Water Pollution Control Centre.
• Indigenous loan guarantee program to build wind power generation capacity (600 megawatts goal).
• $881 million for maintaining and generating hydro-electricity infrastructure.
• $800 in highway construction.

Contingency Fund of $1.1 Billion to Address Tariffs

• Includes $500 million in relief funding for businesses and farmers who could be impacted by tariffs.
  

Business and Agriculture Relief Measures

• Cutting the payroll tax for Manitoba companies, saving $8.5 million annually.
• $500,00 to the export support program.
• $36.4 to the Arctic Gateway Group to strengthen the northern trade corridor.
• $140.8 for Business Risk Management programming for Manitoba farmers and producers.

Cost-of-Living Relief Measures

• 10% reduction to the gas tax.
• $30 million in funding for the Universal School Food Program.
• $14.8 million in renewal funding for the Electric Vehicle Rebate Program.

Investing in Child Care and Education

• $700 million to build 11 new schools.
• $30 million to make the Universal School Food Program permanent.
• $1.7 million in funding for 880 new school-age child care spaces (an extension of $10-a-day child care).

Debt-Serving Payments Grew Slightly by $66 Million

• The $2.34 billion in debt-servicing for 2025/26 is the government’s third largest expense behind only health and education. On the positive side, the net debt to GDP ratio is forecasted to decrease by 1.6%, assuming that the government doesn’t dip into contingencies. 

Analysis and Insights

The Manitoba budget shows a government attempting to balance multiple priorities during a period of unprecedented economic turbulence, which is reflected in its uncertain deficit projections. Some news outlets have speculated that the government prepared this budget far in advance and added the tariffs piece as an afterthought. However, that narrative ignores the very real pressure this government is under to balance the books. This budget reads very clearly as an attempt to show progress toward fiscal austerity while addressing greater global economic turbulence. 

The positive news is that despite the economic pressures, the Manitoba government decided to significantly increase the budget for health, seniors, and long-term care. However, there should be a certain degree of restraint in excitement over the increased budget, as most of the funding is to accommodate the increased wages and number of health professionals in the province. Increasing the number of health care workers is a critical and central part of improving health care systems. 

However, many other crucial elements of system improvement aren’t being addressed in this budget. Other areas that could be strengthened, including pharmacare and innovative initiatives, received much more modest increases. Furthermore, commitments in areas like the transfer of electronic health information are extremely vague. Education and research commitments also fail to receive mention. The lack of action in these areas raises the concern that this government is over-prioritizing health human resources at the expense of other solutions. 

Critics have argued that this budget is overly optimistic in its financial planning. Last year, the government saw its projected deficit rise by $500 million over the course of the fiscal year. There are some eyebrow-raising projections, including anticipated federal transfers of more than $660 million. The claim that the budget will result in a lower debt-to-GDP ratio is also highly suspect given the high probability that the government will need to dip significantly into contingency funds. 

Manitoba Premier Wab Kinew’s government’s second budget is similar to others across the country. It attempts to balance the myriad economic challenges while still following through on previous commitments. Fiscal pressures will undoubtedly continue to elevate pressure on his government, but this budget shows they will continue to prioritize the funding of public services and support for workers throughout the turbulence.