.png){kind=small}
REPEALED
Date: October 9, 2008
C.C.S.M. c. B5
The Balanced Budget, Debt Repayment and Taxpayer Accountability Act
(Assented to November 3, 1995)
HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:
In this Act,
"allocation committee" means the Debt Retirement Fund Allocation Committee appointed under subsection 8(6.2); (« Comité de répartition »)
"balance" for a fiscal year means the net result as shown on the financial statements after expenditure, as adjusted by section 3, is subtracted from revenue, as adjusted by section 3, and after the application of transfers from the operating fund to the Debt Retirement Fund and from the Fiscal Stabilization Fund to the operating fund; (« solde »)
"Crown corporation" means Manitoba Hydro, The Manitoba Public Insurance Corporation, The Liquor Control Commission and The Manitoba Lotteries Corporation; (« société de la Couronne »)
"Debt Retirement Fund" means the fund established in section 8; (« Fonds de remboursement de la dette »)
"expenditure" in respect of a fiscal year means expenditure as reported in the audited financial statements of the operating fund for that fiscal year, but does not include transfers from the operating fund to the Fiscal Stabilization Fund or the Debt Retirement Fund; (« dépenses »)
"financial statements" means the special purpose statements regarding the operating fund, prepared for the purpose of this Act to show whether the government is in compliance with this Act; (« états financiers »)
"Fiscal Stabilization Fund" means the Fiscal Stabilization Fund established in The Fiscal Stabilization Fund Act; (« Fonds de stabilisation des recettes »)
"general purpose debt" means general purpose debt as described in subsection 78(2) of The Financial Administration Act, but does not include
(a) debt associated with the acquisition of capital assets by the government for which an amortization allowance has been included in expenditure of the operating fund, or
(b) other debt incurred by the government for which a repayment provision has been included in expenditure of the operating fund; (« dette à portée générale »)
"minister" means the Minister of Finance; (« ministre »)
"net general purpose debt" means general purpose debt less the book value of related sinking funds; (« dette nette à portée générale »)
"net pension liability" means pension liability less the book value of related funds established for the payment of pensions; (« passif net découlant du régime de retraite »)
"operating fund" means that part of the Consolidated Fund that records the operational activities of the government and does not record activities relating to moneys that are held in trust; (« fonds de fonctionnement »)
"pension liability" means the amount required to fully fund the pensions provided for under The Civil Service Superannuation Act and The Teachers' Pensions Act that are payable out of the operating fund and not funded in another manner; (« passif découlant du régime de retraite »)
"revenue" in respect of a fiscal year means revenue as reported in the audited financial statements of the operating fund for that fiscal year, but does not include transfers to the operating fund from the Debt Retirement Fund or the Fiscal Stabilization Fund; (« recettes »)
BALANCED BUDGET REQUIREMENT
Fiscal year 2000-01 and thereafter
Subject to subsection 4(2), for the fiscal year ending on March 31, 2001 and for each fiscal year thereafter, the government is not to incur a negative balance.
Transfers from Debt Retirement Fund not included in determining balance
For greater certainty, transfers from the Debt Retirement Fund to the operating fund shall not be included in determining whether there is a positive or negative balance for a fiscal year.
Proceeds from sale of Crown corporation not included in determining balance
Revenue or other financial assets received by the government in a fiscal year ending after March 31, 2000 as a result of selling shares or assets of a Crown corporation in the course of a privatization of the Crown corporation shall not be included in determining whether there is a positive or negative balance for the fiscal year.
Other amounts not required to be included in determining balance
The government is not required to include the following in determining whether there is a positive or negative balance for a fiscal year:
(a) an expenditure required in the fiscal year as a result of a natural or other disaster in Manitoba that could not have been anticipated and affects the province or a region of the province in a manner that is of urgent public concern;
(b) an expenditure required in the fiscal year because Canada is at war or under apprehension of war;
(c) a reduction in revenue of 5% or more in the fiscal year, other than a reduction resulting from a change in Manitoba's taxation laws.
A declaration by the Lieutenant Governor in Council that, in the opinion of the Lieutenant Governor in Council, an expenditure or reduction of revenue as described in subsection (2) has occurred is conclusive for the purposes of this Act of the fact that the expenditure or reduction occurred and in that amount.
A declaration under subsection (3) shall include a description of the expenditure and why it was necessary and of the reduction in revenue and why it occurred.
Subject to subsection (6), expenditure and revenue of a fiscal year shall be determined in accordance with the accounting policies that are observed for the fiscal year as disclosed in the audited financial statements of the operating fund for that fiscal year.
If the audited financial statements of the operating fund for a fiscal year contain a reservation of the Auditor General that results directly from a change in accounting policies occurring after March 31, 1995 that is not authorized by this Act, the government will not be considered to be in compliance with this Act unless a restatement of the financial statements of the operating fund for that fiscal year, excluding the effect of the change in accounting policies, would show the government to be in compliance with this Act.
S.M. 2000, c. 42, s. 5; S.M. 2001, c. 39, s. 31.
Negative balance requires offsetting positive balance in following year
If there is a negative balance in a fiscal year, the government is required to achieve at least an offsetting positive balance in the next fiscal year.
Application to government change
If there is a general election and the party forming the government after the election is different from the party forming the government before the election, subsection (1) does not require the government after the election to achieve an off-setting positive balance in connection with a negative balance incurred in the fiscal year during which the election took place.
The audited financial statements of the operating fund for a fiscal year shall be completed and made public within six months after the end of that fiscal year.
The minister shall include a report on compliance with this Act in the third-quarter financial report and in the audited financial statements of the operating fund for a fiscal year.
Failure to meet requirements: third-quarter projection
If in respect of a fiscal year ending after March 31, 2000 the government is projecting a negative balance in the third-quarter financial report, the amount payable to each member of the Executive Council as remuneration for service as a member of the Executive Council, for the 12-month period commencing on April 1 of the fiscal year immediately following the fiscal year to which the third-quarter financial report relates, shall be reduced by
(a) 20%, in a case where the government did not incur a negative balance in the fiscal year immediately preceding the fiscal year to which the report relates;
(b) 40%, in a case where the government incurred a negative balance in the fiscal year immediately preceding the fiscal year to which the report relates.
If the audited financial statements of the operating fund for a fiscal year show that the government is in compliance with this Act and amounts have been deducted from amounts payable to members of the Executive Council in connection with that fiscal year under subsection (1), the amounts so deducted shall be refunded to the members of the Executive Council.
Failure to meet requirements: year-end
If in respect of a fiscal year ending after March 31, 2000 the audited financial statements of the operating fund show that the government incurred a negative balance, and no amount is being deducted from amounts payable to members of the Executive Council under subsection (1) in connection with that fiscal year, the amount payable to each member of the Executive Council as remuneration for service as a member of the Executive Council, for the 12-month period commencing on April 1 of the fiscal year immediately following the fiscal year to which the statements relate, shall be reduced by
(a) 20%, in a case where the government did not incur a negative balance in the fiscal year immediately preceding the fiscal year to which the statements relate;
(b) 40%, in a case where the government incurred a negative balance in the fiscal year immediately preceding the fiscal year to which the statements relate.
The reduction required by subsection (3) may be prorated over the months that remain in the fiscal year after the publication of the audited financial statements of the operating fund.
Ceasing to be a member of the Executive Council
A reduction in the amount payable to a member of the Executive Council under this section applies only during the period when he or she serves as a member of the Executive Council.
New members of the Executive Council
A reduction in the amount payable to members of the Executive Council under this section applies on a prorated basis to any new member of the Executive Council appointed during the period of the reduction.
DEBT RETIREMENT FUND
In this section, "fund" means the Debt Retirement Fund established in subsection (2).
The Debt Retirement Fund is hereby established under the direction and control of the minister.
The minister shall hold the fund in trust and shall manage the fund in accordance with the provisions of The Financial Administration Act and this Act.
Transfers to the fund from the operating fund mandatory
Despite The Financial Administration Act, the minister
(a) may, with the approval of the Lieutenant Governor in Council, transfer to the fund from the operating fund in any fiscal year any amounts that the Lieutenant Governor in Council considers appropriate; and
(b) shall, in each fiscal year ending after March 31, 2000, until the fund is wound up under subsection (12), transfer to the fund from the operating fund an amount equal to the greater of the following amounts:
(i) $96,357,000., as adjusted from time to time under subsection (4.1),
(ii) 1% of the total of the net general purpose debt and the net pension liability as at the end of the immediately preceding fiscal year.
The amount set out in subclause (4)(b)(i) shall be increased in each fiscal year commencing after March 31, 2001
(a) by 7% of all amounts transferred from the fund to the operating fund after March 31, 2000 for the repayment of general purpose debt; and
(b) if the amount remaining, after the allocation to general purpose debt, is insufficient to match the projected pension contributions of new employees hired on or after April 1, 2000, by any amount the minister considers necessary to ensure that those projected pension contributions can be matched.
The minister shall credit to the fund any earnings from investments of the fund.
Transfers from the fund to the operating fund
The minister, with the approval of the Lieutenant Governor in Council,
(a) may, from time to time during a fiscal year, transfer to the operating fund all or any part of the amounts standing to the credit of the fund, to be used for the sole purpose of reducing the general purpose debt and the pension liability of the government; and
(b) shall, at least once every five years after March 31, 2000, transfer to the operating fund all of the amounts standing to the credit of the fund, to be used for the sole purpose of reducing the general purpose debt and the pension liability of the government.
Allocation between general purpose debt and pension liability
The amount transferred to the fund under clause (4)(b) shall be allocated between general purpose debt and pension liability as follows:
(a) for the fiscal year ending March 31, 2001, $75,000,000. to general purpose debt and the remainder to pension liability; and
(b) for each fiscal year ending after March 31, 2001, as determined by the allocation committee.
Debt Retirement Fund Allocation Committee
The Debt Retirement Fund Allocation Committee is established consisting of
(a) the Deputy Minister of Finance, who shall be the chairperson of the allocation committee; and
(b) at least four other individuals appointed by the Lieutenant Governor in Council who, in the opinion of the Lieutenant Governor in Council, demonstrate financial expertise and competence, each of whom may be appointed for any term the Lieutenant Governor in Council considers appropriate.
Duties of allocation committee
The allocation committee shall determine the allocation between general purpose debt and pension liability of
(a) the amounts transferred to the fund under subsection (4) and clause 9(b); and
(b) any earnings from investments of the fund.
Effective reduction of aggregate amount
In determining the allocation of the amounts transferred to the fund between general purpose debt and pension liability, the allocation committee shall follow investment and debt reduction principles that, subject to subsection (6.5), in the opinion of the committee, will result in the most effective reduction of the aggregate amount owing.
Requirement regarding matching contributions for new employees
The allocation committee shall ensure that provision exists for matching the projected pension contributions of new employees hired on or after April 1, 2000.
Notwithstanding any other Act or law, amounts standing to the credit of the fund do not lapse at the end of a fiscal year.
The fiscal year of the fund is the period commencing on April 1 in one year and ending on March 31 in the next year.
The accounts and transactions of the fund shall be audited annually by the Auditor General.
The minister shall, annually, within six months after the end of the fiscal year, submit to the Lieutenant Governor in Council the audited financial statements of the fund for that fiscal year.
Tabling of statements in Assembly
The minister shall table in the Legislative Assembly a copy of the financial statements of the fund provided to the Lieutenant Governor in Council pursuant to subsection (10) immediately if the Assembly is then in Session and, if it is not then in Session, within 15 days of the beginning of the next Session.
If, in the opinion of the minister, sufficient money has been set aside to retire the general purpose debt and cover the pension liability of the government, the minister, with the approval of the Lieutenant Governor in Council, may wind up the fund and transfer any amounts remaining in the fund to the operating fund.
S.M. 2000, c. 42, s. 8; S.M. 2001, c. 39, s. 31.
DISPOSITION OF POSITIVE BALANCE
Disposition of positive balance
If a positive balance exists in a fiscal year, the minister shall dispose of the amount of the positive balance as follows:
(a) the amount required to bring the Fiscal Stabilization Fund to its target level as described in section 3.1 of The Fiscal Stabilization Fund Act, or any greater amount that the minister, with the approval of the Lieutenant Governor in Council, considers appropriate, shall be transferred to the Fiscal Stabilization Fund;
(b) any amount remaining after a transfer under clause (a) may be left as a positive balance of the operating fund or may, with the approval of the Lieutenant Governor in Council, be transferred to the Debt Retirement Fund.
TAX REFERENDUM REQUIREMENT
Referendum required for tax changes
Subject to subsection (2), the government shall not present to the Legislative Assembly a bill to increase the rate of any tax imposed by an Act or part of an Act listed below, unless the government first puts the question of the advisability of proceeding with such a bill to the voters of Manitoba in a referendum, and a majority of the persons who vote in the referendum authorize the government to proceed with the changes:
(a) The Health and Post Secondary Education Tax Levy Act;
(b) The Income Tax Act;
(c) The Retail Sales Tax Act;
(d) Repealed, S.M. 2007, c. 6, s. 104.
Revenue neutral and external changes
Subsection (1) does not apply to
(a) a bill to increase the rate of a tax if, in the opinion of the minister, the increase results from changes in federal taxation laws and is necessary to maintain provincial revenue or to give effect to a restructuring of taxation authority between the federal government and provincial governments;
(b) a bill to increase the rate of a tax if, in the opinion of the minister, the proposed change is designed to restructure the tax burden and does not result in an increase in revenue.
S.M. 2005, c. 40, s. 125; S.M. 2007, c. 6, s. 104.
A referendum under subsection 10(1) shall be conducted and managed by the Chief Electoral Officer in the same manner, to the extent possible, as a general election under The Elections Act, and the provisions of The Elections Act apply with necessary modifications to a referendum.
The question to be put to voters in a referendum under subsection 10(1) shall be determined by Order of the Lieutenant Governor in Council at the commencement of the referendum process.
The Lieutenant Governor in Council may make any regulations that the Lieutenant Governor in Council considers necessary respecting the referendum process to give effect to subsection 10(1), including, without limiting the generality of the foregoing,
(a) governing the preparation of a voters list;
(b) governing the expenses, if any, that may be incurred, and the contributions, if any, that may be made, and by whom, in connection with a referendum;
(c) where greater certainty is required, modifying to the extent necessary the provisions of The Elections Act to make them applicable to the requirements of a referendum.
The costs of conducting a referendum shall be paid from the Consolidated Fund.
AMENDMENT OR REPEAL
Any bill introduced in the Legislative Assembly to amend, repeal, override or suspend the operation of this Act shall be referred at the committee stage to a standing committee of the Legislative Assembly which provides the opportunity for representations by members of the public.
The standing committee reviewing a bill described in this section shall not be scheduled until seven days after the later of
(a) the day the bill is distributed in the Legislative Assembly; and
(b) the day the public is given notice of the date, time and place of the committee meeting.
NOTE: This section contained consequential amendments to The Fiscal Stabilization Fund Act which are now included in that Act.
This Act may be cited as The Balanced Budget, Debt Repayment and Taxpayer Accountability Act and referred to as chapter B5 of the Continuing Consolidation of the Statutes of Manitoba.
This Act comes into force on the day it receives royal assent.