Manitoba Budget 2017 is a Mixed Bag, with More Cuts than Increases to CED Priorities

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MANITOBA BUDGET 2017Leading up to the first full budget by the new provincial government, there was a significant amount of apprehension among community groups around austerity and potential spending cuts.  With 15,000 children waiting for child care, 7,500 housing units needed to respond to homelessness in Winnipeg alone, and 132,000 Manitobans living in poverty, it would have been harmful to balance the budget on the backs of vulnerable Manitobans.

However, Budget 2017 is a mixed bag, with more program reductions than investments in CCEDNet-Manitoba's member priorities, but more programs maintained than some had expected.

For instance, we are glad to see the government increase funding for Rent Assist and maintain funding for the Northern Healthy Foods Initiative while also giving a prominent role to social enterprise. However, cuts to community development, co-operative development and affordable housing, along with a stall on a comprehensive poverty reduction plan, will work against supporting inclusive communities and economies in Manitoba.

See Budget 2017 here.

As the provincial government continues to define its course, it will take some work on the part of community organizations, social enterprises and cooperatives to find their role in the path forward. The following analysis covers areas of provincial policy important to the work of CCEDNet Manitoba members. To see our submission to the Budget 2017 consultation process, visit here.

Community Development

Programs under Community Planning and Development in Indigenous and Municipal Relations have seen a significant reorganization, but some consistency in amounts. Funding for Neighbourhoods Alive! (NA!) will be maintained at the same spending level as the previous year but the Province underspent last year as a result of pausing NA! programs mid-year. Therefore, the NA! budget has been reduced by  approximately $900,000 (or 15%), from $5.97 M in Budget 2016/17 to $5.08 M in 2017/18. In speaking to a government representative, we learned that the department is establishing new program delivery processes, and anticipates further consultation with non-profit organizations. There is no stated commitment to existing multi-year funding agreements, and organizations funded under these programs should reach out to their department contacts for further information.

Included in the reorganization is the elimination of the Urban Development Initiative and Rural Economic Development Initiative. We learned that this funding has not been cut, but permanently allocated to departments with initiatives funded via these programs. Those departments now have discretion over their allocation. Funding initiatives through IMR have been collapsed into a new program called Community Development Initiatives. Intake and funding criteria for this fund have not been announced at this time.

Co-op Development

Cooperatives are hard hit in this budget, with the cancellation of the Co-op Community Strategy, and the elimination of the Co-op Development Tax Credit. While elements of the strategy are being maintained, accounting for $70,000 in spending, total spending on Co-op Development has gone from $601,000 to $456,000, which is a decrease of $145,000 or 24%. We hope that despite these changes, we will see a new way forward for cooperatives in Manitoba and will be asking the government to consider how they can support these inclusive, democratic community enterprises.

Social Enterprise

CCEDNet Manitoba called on the Province to grow its social procurement commitments to $10M (currently at $7M). Social enterprise was specifically highlighted in the Budget Paper “REDUCING POVERTY AND PROMOTING COMMUNITY INVOLVEMENT”. In a section titled Front-Line Services Through Innovative Partnerships, this Budget Paper celebrates Manitoba Housing’s practice of social procurement, highlighting the five social enterprises that are providing services to Manitoba Housing (New Directions – Genesis, NECRC – Building Construction Mentorship Program, BNRC – Brandon Energy Efficiency Program, BUILD and Manitoba Green Retrofit) and the collective 220 jobs this provides for individuals facing barriers to employment. It also notes the training partnership with social enterprise Diversity Foods. We are glad to see this prominent mention of these CCEDNet Manitoba members. However, it is unclear if the government is planning to change the amount of procurement currently going to social enterprise, or expand the practice beyond Manitoba Housing.

Despite mentioning the significant social return on investment generated by the social enterprise strategy, it is also unclear if the government is planning to continue funding the sector-developing strategy in partnership with CCEDNet Manitoba.

One policy priority for CCEDNet Manitoba is to see the Justice department reverse its trend towards greater incarceration through prevention and reintegration by engaging social enterprises that support individuals involved with, or at-risk of involvement, with the criminal justice system. The Justice department’s operating budget has increased 2.1% (or by $12.2M), from $586.5M in 2016/17 to $598.7M in 2017/18 -- these increases can be partially offset by more programming for prevention and reintegration to keep individuals out of the criminal justice system. The Community Safety budget, which includes funding for correctional services as well as crime prevention policies and programs has increased from $410.6 M to $420.5 M. However, there is no mention of social enterprise as a tool for crime prevention and reintegration.

Social Finance

The Budget reiterates the government’s commitment to launching a “made-in-Manitoba approach to Social Impact Bonds,” (SIBs) however it is not clear if there is any budget allocation for the development of SIBs, nor the fields they are planning to execute SIBs in.

The Neighbourhoods Alive! Tax Credit has been cancelled. While this program, which provided a 45% tax credit to corporations who donated $50,000 or more to a non-profit organization to establish a social enterprise, needed improvements (it had only been used once since its inception), CCEDNet Manitoba members still see potential in the opportunity to partner with corporations for social enterprise development.

The Community Enterprise Development Tax Credit is being maintained. We will continue to advocate that the Government of Manitoba improve the application process for this tax credit and better promote it to the community.

Northern Healthy Foods Initiative

CCEDNet called on the Manitoba government to increase funding to the Northern Healthy Foods Initiative (NHFI) to scale up healthy food production and consumption, in part through social enterprise, in northern and remote communities. Funding for the NHFI has been maintained at $1.2M for 2017/18. While we are happy to see NFHI funding maintained, this amount continues to be insufficient to address the challenges and costs of food insecurity in remote and northern communities. For instance, the economic burden of diabetes in Manitoba in 2010 was estimated to be approximately $86M in direct costs and an additional $412 M in indirect costs. Investments in healthy food is an important component in addressing this cost and we hope to see additional programs and investments to address this issue.

It is not clear at this time how much, if any, of NHFI's funding will be earmarked for social enterprise development, or if there is any other funding specific to social enterprise development in northern and rural Manitoba.

Minimum Wage

For a second year in a row, the Manitoba government has not increased the minimum wage.  It continues to sit at $11.00 per hour since last increased in October 2015 meaning that those working for minimum wage will continue to see their incomes fall behind what is needed to afford the cost of living. This continues to break the 17-year trend of regular minimum wage increases despite full-time minimum wage work still failing to bring Manitoba families above the poverty line.

Childcare

The Early Learning and Child Care budget increased by just over $6M in Budget 2017. The Province promises funding for 501 new licensed child care spaces and 50 new home-based spaces to help shorten child care wait times. It also promises to increase operating grants for home-based child-care providers. While childcare advocates welcome this small increase, it does not go far enough to meet the needs of more than 14,500 children who are on the online child care registry waitlist. This disproportionately affects women, as they are more often prevented from education and employment opportunities due to a lack of accessible child care.

Visit the Manitoba Child Care Association for more information.

Poverty Reduction Strategy

Make Poverty History Manitoba was anticipating the launch of a comprehensive poverty reduction strategy in Budget 2017 based on last year’s budget which noted that work would begin immediately on the development of such a strategy in preparation for Budget 2017. However, the budget now notes that the updated strategy is not expected to be launched until late 2017. Make Poverty History Manitoba has called for a comprehensive plan developed in partnership with the community and accompanied by targets and timelines for reducing poverty. Budget 2017 notes that the development of the provincial strategy will include an engagement process to identify the priorities of Manitobans. It also notes that the province will develop targeted performance indicators.

Make Poverty History Manitoba prioritized the need to increase the basic needs budget for Manitobans on EIA and transition to a portable benefit, like Rent Assist, to make the benefit available to the working poor. The goal was to bring all Manitobans to at least 75% of the poverty line in Budget 2017. The budget does not make any reference to increasing EIA rates.

Visit Make Poverty History Manitoba for more information.

Housing

Right to Housing called on the Province to commit to 300 new social housing units built by the public, non-profit and co-op sectors to help address the need for affordable housing. However, Budget 2017 does not set a target and timeline for building new social housing. Budget 2017 provides up to $149M for capital (new supply and maintaining existing supply). This is down from $280M in 2016, and it is roughly a third of what was available on an annual basis when the Province was investing in a capital program that delivered 1,500 units between 2009 and 2014. This reduction in the amount available for capital combined with a $20M dollar reduction for operations leaves Manitoba Housing with approximately $150M less for its social and affordable housing programs than what was in last year’s budget.

Budget 2017 continues to invest in Rent Assist, a program that provides an income benefit (up to 75% of median market rent) to low-income Manitobans to top up their rent. Its budget line was increased, in part to be able to index the benefit to keep up with rising rental costs. But the benefit itself will not be enhanced.

Visit Right to Housing for more information.

Accessibility for Manitobans

All parties passed The Accessibility for Manitobans Act (AMA) in 2013 to achieve the comprehensive prevention and removal of barriers. The Conservative party committed to the full and timely implementation of the AMA during the 2016 provincial election. The AMA establishes responsibility for achieving significant progress toward accessibility by 2023, but implementation is lagging. CCEDNet Manitoba called on the Province to invest significantly increased human and related resources to ensure the timely and effective implementation of the AMA. The Disability Issues Office is the government unit most responsible for the implementation of the Accessibility for Manitobans Act and it received a welcome 20.7% increase. However, implementation is an immense responsibility that has been gravely underfunded to date.

Visit Barrier Free Manitoba for more information.

Environmental Omissions

Climate change is a defining issue of our time, imposing high and escalating costs on society over the coming decades and centuries. It requires clear, effective, and decisive action to reduce emissions. The Organisation for Economic Cooperation and Development estimates that every dollar the industrialized world fails to invest in clean energy today will cost more than four dollars down the road. CCEDNet’s membership called on the Manitoba government to implement a carbon pricing strategy as well as ban on organics disposal by 2020.

Unfortunately, climate change does not have a significant role in this budget. There is no mention of carbon pricing or an organics disposal beyond a reiteration of a previous commitment to develop a climate and green plan in the future.


Kirsten BernasKirsten Bernas is Research and Policy Manager with CCEDNet in Manitoba. She has also been employed by the Province of Manitoba to work on CED and social policy. Kirsten represents CCEDNet on the Canadian Centre for Policy Alternatives' Alternative Federal Budget Steering Committee, Make Poverty History Manitoba's Steering Committee, and the Right to Housing Coalition's Provincial Committee. She received a BA (Honours) in Economics from the University of Manitoba as well as an MA from the Norman Paterson School of International Affairs at Carleton University in Ottawa.

Darcy PennerDarcy Penner has been working in community economic development since graduating from the University of Winnipeg with a BA (Honours) degree in Politics. Starting at CCEDNet in 2013, his role has seen him work with member-organizations to pursue a broad policy agenda through workshops, presentations, budget submissions, policy papers and community-organizing, while specializing in supportive social enterprise policy and research – including being the Project Manager for the Manitoba Social Enterprise Strategy being co-produced with the Province of Manitoba, and coordinating the Manitoba Social Enterprise Sector Survey. 

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