After record tax increases Gillingham still can’t balance the books

The City of Winnipeg is projecting a $17.7 million year-end deficit in its 2025 tax-supported operating budget as of June 30. This is a slight $1.2 million improvement from the first-quarter forecast. Yet city officials presented this as if it were a positive development. Running a $17.7 million deficit is not an accomplishment. It is a failure. The fact that our mayor and his executive policy committee framed this as progress should concern every taxpayer and business owner in Winnipeg.

The numbers make it clear. Planning, Property and Development is down $4.3 million due to lower revenues. The Winnipeg Fire Paramedic Service is short $3.1 million because of overtime and compensation costs. Assets and Project Management is down $3 million from reduced transfers. The Winnipeg Police Service fell $2 million short on savings targets. Some savings were found: $3.3 million in Public Works from lower snow-clearing costs and $2.7 million in Corporate Finance from higher investment earnings. But that does not erase the shortfall.

City hall says $44.9 million of the $51.8 million in budgeted savings will be achieved, and the reserve fund will cover the rest. That leaves just $14.7 million in the Financial Stabilization Reserve. Legislation requires a balance closer to 6 percent of tax-supported spending, which today should mean more than $90 million. Instead, we have a reserve fund that barely exists.

And here is what makes this deficit even harder to accept. The mayor has already pushed through the largest property tax increase in decades. He added a new waste collection fee and a new water and sewer fee for some residents. Altogether, these hikes and charges are costing families more than $500 a month in city taxes and new fees. After extracting that much more from residents’ pockets, he still can’t balance the books. That tells you the problem is not revenue—it is management.

City leaders point to “efficiencies” as proof they are managing responsibly. But the numbers show otherwise. The 2025 budget included $51.8 million in efficiency and expenditure management targets. As of June 30, only $44.9 million is forecasted to be achieved, leaving $6.9 million unaccounted for. Even those so-called savings are not real efficiencies. They include $5.7 million in carbon and fuel tax savings, $7.9 million in debt and finance savings from deferring debt, $2.5 million pulled from the Workers’ Compensation Reserve, $2 million in extra revenue from the Assessment and Tax Department, $1.5 million in short-term interest revenue, and $1.7 million in assorted division savings. Transferring millions from the WCB reserve to offset Fire and Paramedic costs is not an efficiency. It is a shell game, plain and simple.

Why does this matter? Because reserve funds exist for a reason. They are not political slush accounts. They are safeguards against real-world crises—floods, infrastructure failures, or sudden downturns. In business terms, it is the emergency fund. No responsible household or company operates without one. Yet Winnipeg has drained it, and the mayor calls that responsible budgeting.

This problem is not new. Scott Gillingham was Brian Bowman’s finance chair when the city started shifting money out of reserves to prop up budgets. They called it a “prudent four-year plan.” It was not prudence. It was a shell game. Today, the reserve fund is gone, and the city is more vulnerable than ever.

The mayor will say the city is managing responsibly, that Winnipeg is finding efficiencies, that it is still covering its obligations. But if your definition of responsibility is drawing down savings meant for emergencies just to paper over operational deficits, then you’ve set the bar so low it’s underground. If this were a corporation, shareholders would demand answers. If this were a household, the family would be one unexpected expense away from collapse. Yet in city hall, they congratulate themselves for missing the target by slightly less than expected.

Every year the city blames the same departments: police, fire, and paramedics. This year, the police are accused of failing to find savings. But telling a department to cut 2 percent does not fix chronic problems that drive costs. Overtime is not new. It is the result of too few people covering too many calls. In 2024, Winnipeg police responded to nearly 240,000 calls for service. Fire and paramedic calls rise every year. Cutting budgets in these areas is not efficiency—it is negligence.

City leaders know this. They also know blaming public safety services shields them from blame. It is easier to point at police overtime than to admit that chronic understaffing and poor planning are the real issues. Residents are told the city is “managing responsibly” while the basic numbers prove the opposite.

Where is the province in all this? Premier Wab Kinew cannot hold Gillingham accountable when his own government is running deficits and has no clear plan for Manitoba’s finances. A premier who cannot balance his own books is unlikely to demand discipline from a mayor doing the same. That leaves taxpayers with no one demanding accountability at either level.

The Financial Stabilization Reserve was created to force fiscal discipline on elected officials. By law, it should not be allowed to sink to $14.7 million. The fact that it has shows how little oversight exists. If the province or auditors took that legislation seriously, city hall would not get away with it.

The approach is unsustainable. Using reserves to cover deficits is like paying your mortgage with a credit card. It might get you through a month or two, but eventually the bill comes due with interest. When a flood, fire, or economic shock hits, Winnipeg will not have the resources to respond. The consequences will fall on residents and businesses who were told everything was under control.

It also hurts the city’s credibility. Investors and business leaders look at fiscal health before putting money into a city. A city that drains its reserves, normalizes deficits, and relies on spin instead of solutions sends a message: this is not a serious place to invest. That reputation has real costs.

The announcement of a $17.7 million deficit is not a victory. It is proof of how low the bar has been set. Residents are told to measure success not by whether the city is financially secure, but by whether the hole is slightly smaller than expected. That is not success. That is complacency.

Winnipeg needs a reset in how it manages money. The reserve must be rebuilt to legislated levels. Budgets must be based on reality, not shell games. Overtime and staffing issues in police and fire must be addressed, not dismissed with blanket savings targets. And both the city and province must be held accountable for treating deficits as normal rather than as failures.

Until that happens, the spin from city hall means nothing. The facts remain: taxes and fees are higher than ever, reserves have been gutted, and the city is still in deficit. That is not fiscal responsibility. It is failure, and taxpayers should not be asked to accept it as normal.