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Manitoba Tories would wean province off Ottawa payments, make it a 'have' province

A Progressive Conservative government in Manitoba would move to wean the province off federal equalization payments and turn it into a "powerhouse" in Canada.

During an election campaign debate Thursday before a business crowd, Tory Leader Hugh McFadyen said Manitoba relies on $4-billion annually from Ottawa – almost half the province's budget.

That needs to change, he suggested.

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"It's not a sustainable way of building a province into the future," Mr. McFadyen said. "We need to ... become a 'have' province again that stands up on our own two feet and grows our economy from within so we can be a powerhouse within Canada once again."

The governing New Democrats said equalization payments make up $2-billion every year and the other $2-billion is made up of transfer payments that all provinces receive for health and education.

Mr. McFadyen didn't offer specific examples of how he would make up the $2-billion in federal funding if he were to win the Oct. 4 election. Nor did he give a deadline for when he would like to see Manitoba completely free of the transfers.

Although Manitoba does not have a lucrative natural resource like oil, it's not unrealistic to envision a time when the province won't need handouts from Ottawa, Mr. McFadyen said.

"Lots of people would have said years ago, 'How could Saskatchewan ever get out of being a have-not province?' And they have. Newfoundland used to be on the receiving end of equalization. They are no longer," the Tory leader said following the debate.

"What we want to see is to begin to take positive steps in that direction."

NDP Premier Greg Selinger said Manitoba is already on the right track and took in $75-million less from Ottawa this year. The provincial economy has outpaced the Canadian average for the last five years, he added.

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The NDP's focus is to improve education, continue to build the provincial utility so it can boost hydro exports and beef up apprenticeship opportunities in rural areas, Mr. Selinger said.

"All those things will grow the economy. The result of that will be less transfer payments," he said. "We're on a roll right now. We want to keep it going in the right direction."

Still some are not as eager to reduce reliance on equalization. Liberal Leader Jon Gerrard said equalization has been vital for the province.

He acknowledged there is a danger in being overly dependent on federal transfers because they could be cut. But Mr. Gerrard added that now may not be the time to create a $2-billion hole in the budget.

"It would be wonderful for us to be a 'have' province and not need equalization and one day we will get there," he said. "But in the short run, we need somebody who is going to fight to make sure that ... Manitoba is treated fairly because that is going to be very important in terms of getting through what may be quite difficult economic times."

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