Province Of Manitoba 18-K/A Annual report (foreign governments) (amended)

Exhibit 99.1

Province of Manitoba
Opportunity and Stability
Moving Forward on Manitobans’ Priorities

2008/09 Quarterly Financial Report
April to June 2008

CONTENTS

Introduction
First Quarter Financial Results
Economic Performance and Outlook

INTRODUCTION

Budget 2008 provided a financial overview of the Government Reporting Entity (GRE), which includes core government and Crown organizations, government business entities and public sector organizations such as regional health authorities, school divisions, universities and colleges. The financial information in the quarterly financial report is being presented in the same format as the budget. This will allow for a smooth transition of quarterly financial reporting to a summary basis and, as recommended by the Office of the Auditor General, to be consistent with Generally Accepted Accounting Principles (GAAP). This transition is expected to be complete by the end of 2009/10.

Consistent with prior years, the first quarter report provides the results of the core government for the three months ended June 30, 2008, but with the presentation of the financial results consistent with the presentation in Budget 2008. In addition, this report provides Manitobans with a summary of the province’s recent economic performance and outlook.

The second quarter financial report will continue to move forward on reporting financial results for the GRE. It will include financial results of core government for the six months ending September 30, 2008 as well as a financial forecast for the GRE for the current year and will continue with inclusion of an economic update. Beginning with the third quarter, the report will contain the financial results of the GRE for the nine months ending December 31, 2008 as well as an updated year-end projection for the GRE and an updated economic performance and outlook.

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

SUMMARY NET INCOME

For fiscal year 2008/09 Summary Net Income for the GRE is budgeted to be $96 million.

Projection of Summary Net Income

For the Fiscal Year Ending March 31, 2009

	2008/09 Budget
				Consolidation
				Impacts and Other
(Millions of Dollars)	Core Government			Reporting Entities			Summary
Revenue		9,851			2,472			12,323
Expenditure		9,799			2,428			12,227
Net Result for the Year		52			44			96
Transfer to Debt Retirement Account		(110	)		110			—
Transfer from Fiscal Stabilization Account		60			(60	)		—
Net Income		2			94			96

Government Reporting Entity (GRE)

The GRE is comprised of core government and other reporting entities. The core government component of the GRE represents the operations, programs and services delivered by government departments. Other reporting entities include Crown organizations, government business entities and public sector organizations such as regional health authorities, school divisions, universities and colleges that are directly or indirectly controlled by the Government, as prescribed by the Public Sector Accounting Board (PSAB).

As previously noted, an updated forecast for the fiscal year end will be provided in the second quarter financial report.

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

CORE GOVERNMENT — First Quarter Financial Results

Revenue and Expenditure

The first quarter net result of expenditure exceeding revenue by $119 million was $30 million lower than the projection of $149 million. First quarter revenue was $22 million higher than projected and first quarter expenditure was $8 million lower than estimated primarily as a result of differences in the timing of expenditures and receipts.

Core Government Operating Statement

UNAUDITED

	Year-to-Date to June 30												Full Year
	2008/09									2007/08			2008/09
($000s)	Actual			Estimated			Variance			Actual			Budget
Revenue
Income Taxes		655,212			655,210			2			607,596			2,611,300
Other Taxes		512,197			493,589			18,608			465,721			2,666,200
Fees and Other Revenue		106,015			99,534			6,481			100,815			433,501
Federal Transfers		892,717			895,300			(2,583	)		840,912			3,612,039
Net Income of Government
Business Enterprises		89,300			89,300			—			95,900			528,500
Total Revenue		2,255,441			2,232,933			22,508			2,110,944			9,851,540
Expenditure
Health and Healthy Living		1,017,003			1,028,645			(11,642	)		1,010,607			4,133,022
Education		607,172			609,472			(2,300	)		579,270			1,981,473
Family Services and Housing		280,048			273,863			6,185			249,752			1,196,763
Community, Economic and Resource Development		250,494			249,170			1,324			226,963			1,402,232
Justice and Other Expenditures		167,820			174,549			(6,729	)		170,076			823,055
Debt Servicing Costs		51,554			46,572			4,982			75,823			262,500
Total Expenditure		2,374,091			2,382,271			(8,180	)		2,312,491			9,799,045
Net Result		(118,650	)		(149,338	)		30,688			(201,547	)		52,495
Transfer to Debt Retirement Account		—			—			—			—			(110,495	)
Transfer from Fiscal Stabilization Account		—			—			—			—			60,000
Net Income (Loss)		(118,650	)		(149,338	)		30,688			(201,547	)		2,000

Revenue and expenditure details are provided in Appendix I and II on pages 7 and 8.

Capital Investment

Expenditures for general assets and infrastructure assets in the first quarter were $43 million, $29 million less than estimated primarily due to timing variances related to the Manitoba Floodway Expansion and highway related activities caused primarily by unfavorable weather conditions.

Capital investment details are provided in Appendix III on page 9.

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

SPECIAL ACCOUNTS

Fiscal Stabilization
The budgeted draw in 2008/09 is $47 million for wait-times reduction initiatives and other health-related programming and $13 million for requirements related to ecoTrust funds advanced by the Government of Canada.

Debt Retirement
The 2008 Budget provides for a $110 million contribution to Debt Retirement. An allocation committee will determine the share of those funds directed to pensions or general purpose debt. In the 2008 Budget, the allocation was projected to be $85 million to the pension liability and $25 million for general purpose dept.

Pension Assets
In addition to the $85 million contribution projected above, the balance of the pension assets will increase for 2008/09 as a result of the government’s commitment to contribute $500 million to commence funding of the province’s unfunded liability for the Civil Service Superannuation Fund.

Opening balances for the special accounts will be available upon the completion of the audited financial results for 2007/08 and the release of the Public Accounts. Therefore, the 2008/09 fiscal year-end forecast for these accounts will be updated in the second quarter financial report.

PROVINCIAL BORROWINGS, GUARANTEES AND OBLIGATIONS

The estimate of borrowing requirements identified in the 2008 Budget was $2.8 billion including refinancing of $1.5 billion and new cash requirements of $1.3 billion, offset by a repayment of $61 million. The forecast for the year end remains unchanged at this time.

The total outstanding borrowings, guarantees and obligations reflect the province’s gross borrowing obligations, but it does not take into consideration liquid assets available to pay down those obligations. While the total of outstanding provincial borrowings fluctuates during the fiscal year as a result of the timing of borrowing activities of the province, the year end forecast remains unchanged from that stated in the budget as shown in the table on the following page.

An updated forecast for 2008/09 with comparative data for 2007/08 actual results will be provided in the second quarter financial report.

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

Provincial Borrowings, Guarantees and Obligations

	2008/09 Budget
	$ millions			$ Per Capita1
Provincial Borrowings, Guarantees and Obligations
General Government Programs		6,349			5,307
Manitoba Hydro		7,333			6,130
Other Crown Organizations		1,333			1,114
Health Facilities		963			805
Federal Government2		81			68
Capital Investments		1 ,415			1,183
Subtotal		17,474			14,607
General Government Programs — Pensions3		2,000			1,672
Subtotal4		19,474			16,279
Other Obligations
Pension Liability		4,611
Pension Asset Fund		(2,925	)
Net Pension Liability		1,686
Debt incurred for and repayable by the Manitoba Hydro Electric Board and Manitoba Lotteries Corporation		(6,898	)
Education and Health Debt held by Government Enterprises		389
Other Debt of Crown Organizations		367
Subtotal		(4,456	)
Total Provincial Borrowings, Guarantees and Obligations		15,018
Adjustments to arrive at Summary Net Debt
Guarantees		(367	)
Net Financial Assets		(3,729	)
Summary Net Debt		10,922		9,130 - $Per Capita
Summary Net Debt as a percentage of GDP		21.7	%

1.	Per Capita data is based upon population figures at April 1, 2008 as reported by Statistics Canada.
2.	Amounts owed relating to federal accounting errors in prior years. See Note 16, page 77 of the 2006/07 public accounts for additional information.
3.	In 2007/08, the Government made a contribution of $1.5 billion to the Teachers’ Retirement Allowances Fund (TRAF). This contribution increases overall funding of the outstanding TRAF pension liability to 75%, reducing the unfunded portion of the pension liability from $2,164 million to $651 million. In 2008/09, the Government will make a contribution of $0.5 billion to the Civil Service Superannuation Plan.
4.	Provincial Borrowings and Guarantees are payable in Canadian and U.S. dollars. As at June 30, 2008 total provincial borrowings and guarantees were payable 88% in Canadian dollars and 12% in U.S. dollars. Of this total, General Government Program borrowings and Other Crown Organizations borrowings were 100% payable in Canadian dollars. Manitoba Hydro borrowings were payable 64% in Canadian dollars (64% at March 31, 2008) and 36% in U.S. dollars (36% at March 31, 2008).

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

ECONOMIC PERFORMANCE AND OUTLOOK
(Manitoba Economic Highlights — as of August 25, 2008)

Economic growth in Manitoba is expected to be relatively strong in 2008. Manitoba Finance’s survey of private economic forecasters, completed August 25, shows real Gross Domestic Product (GDP) in Manitoba will grow 2.5% in 2008, above the projected national increase of 1.2% but below the 2.7% growth projected at the time of the 2008 Manitoba Budget. The Manitoba Bureau of Statistics estimates that Manitoba’s real GDP grew 3.0% in 2007, above the national economy’s increase of 2.7%.

Through the first seven months of 2008, Manitoba’s employment has increased by 12,100 jobs, up 2.0% relative to the same period in 2007 and slightly above the national increase. Manitoba’s full-time employment increased 3.0% while part-time employment declined by 2.0%. Over this same period, Manitoba’s unemployment rate averaged 4.0%, down from the 2007 annual unemployment rate of 4.4% and below the national rate of 6.0%.

Through the first six months of 2008, Manitoba’s retail sales increased 9.2% relative to the same period in 2007. Manitoba’s increase is second-best among provinces and well above the national increase of 4.5%.

Manitoba housing starts in the first half of 2008 declined 2.8% relative to the same period in 2007. Single family units rose 2.0% while multiple units declined 10.6%. Overall, housing starts in Canada have increased 0.3% this year. In 2007, Manitoba housing starts were up 14.1% to 5,738, the highest level in 20 years.

In the first six months of 2008, Manitoba manufacturing sales decreased 2.4% to $8.3 billion. Canadian sales declined 3.3%.

Manitoba’s foreign merchandise exports through the first six months of 2008 decreased by 0.8%. Exports to the United States increased by 2.3% while exports to non-US markets declined 8.4%. Canada’s exports over the same period increased by 2.6%. Over the past two years, Manitoba’s total foreign exports rose 25.7% to $11.6 billion.

Manitoba farm cash receipts through the first half of 2008 increased by 11.8%, above the national increase of 10.7%. Receipts from crops are up 34.3%. Livestock receipts are down 11.2%, largely due to weaker receipts for hogs. In 2007, Manitoba farm cash receipts rose 17.1%.

In the first seven months of 2008, the Manitoba Consumer Price Index rose 1.8%, below the national increase of 2.3%. Energy and shelter were the major contributors to the increase.

Manitoba’s population reached 1,193.6 thousand as of April 1, 2008. This is an increase of 12,986 persons, or 1.1%, from April 1, 2007. Canada’s increase over the same period was also 1.1%.

For updates and more details please see the Manitoba Economic Highlights at http://www.gov.mb.ca/finance/pdf/highlights.pdf

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

Core Government Revenue by Source Appendix I

UNAUDITED

	Year-to-Date to June 30									Full Year
	2008/09							2007/08		2008/09
($000s)	Actual		Estimated		Variance			Actual		Budget
Income Taxes
Individual Income Tax		576,372		576,370		2			532,044		2,312,100
Corporation Income Tax		78,840		78,840		—			75,552		299,200
Subtotal: Income Taxes		655,212		655,210		2			607,596		2,611,300
Other Taxes
Corporation Capital Tax		45,910		39,300		6,610			40,619		123,200
Gasoline Tax		22,443		22,900		(457	)		25,074		137,000
Insurance Corporations Tax		16,162		16,173		(11	)		15,306		63,500
Land Transfer Tax		11,234		10,491		743			9,543		43,600
Levy for Health and Education		55,009		52,300		2,709			51,097		344,400
Mining Tax		62,586		65,400		(2,814	)		45,396		128,000
Motive Fuel Tax		16,900		12,400		4,500			12,740		90,100
Retail Sales Tax		235,399		230,420		4,979			217,725		1,469,400
Tax Administration and Miscellaneous Taxes		12,801		12,200		601			12,933		79,900
Tobacco Tax		30,315		28,700		1,615			32,282		170,000
Other Taxes		3,438		3,305		133			3,006		17,100
Subtotal: Other Taxes		512,197		493,589		18,608			465,721		2,666,200
Fees and Other Revenue
Fines and Costs and Other Legal		11,118		11,192		(74	)		10,772		44,091
Minerals and Petroleum		5,156		2,386		2,770			2,748		9,386
Automobile and Motor Carrier Licences and Fees		30,482		29,464		1,018			29,547		106,092
Parks: Forestry and Other Conservation		4,621		5,175		(554	)		4,764		34,083
Water Power Rentals		27,503		26,329		1,174			27,109		105,000
Service Fees and Other Miscellaneous Charges		21,886		19,739		2,147			20,526		113,854
Revenue Sharing from SOAs		5,249		5,249		—			5 ,349		20,995
Subtotal: Fees and Other Revenue		106,015		99,534		6,481			100,815		433,501
Federal Transfers
Equalization		515,849		515,849		—			425,837		2,063,400
Canada Health Transfer (CHT)		211,446		211,446		—			201,757		845,800
Canada Social Transfer (CST)		94,509		94,509		—			85,106		378,000
Infrastructure Renewal		—		—		—			—		50,000
Manitoba Floodway Expansion		—		3,000		(3,000	)		—		75,233
Shared Cost and Other Transfers		70,913		70,496		417			128,212		199,606
Subtotal: Federal Transfers		892,717		895,300		(2,583	)		840,912		3,612,039
Net Income of Government
Business Enterprises (GBEs)
Manitoba Liquor Control Commission		14,000		14,000		—			27,900		227,300
Manitoba Lotteries Corporation		75,300		75,300		—			68,000		301,200
Subtotal: Net Income of GBEs		89,300		89,300		—			95,900		528,500
Sinking Funds and Other Earnings		—		—		—			—		—
Total Revenue		2,255,441		2,232,933		22,508			2,110,944		9,851,540

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

Core Government Expenditure by Sector/Department Appendix II

UNAUDITED

	Year-to-Date to June 30									Full Year
	2008/09							2007/08		2008/09
($000s)	Actual		Estimated		Variance			Actual		Budget
Health and Healthy Living		1,017,003		1,028,645		(11,642	)		1,010,607		4,133,022
Education
Advanced Education and Literacy		112,723		111,191		1,532			107,438		572,335
Education, Citizenship and Youth		494,449		498,281		(3,832	)		471,832		1,409,138
Total Education		607,172		609,472		(2,300	)		579,270		1,981,473
Family Services and Housing		280,048		273,863		6,185			249,752		1,196,763
Community, Economic and Resource Development
Aboriginal and Northern Affairs		7,128		10,576		(3,448	)		9,800		40,580
Agriculture, Food and Rural Initiatives		26,249		18,402		7,847			14,997		217,051
Competitiveness, Training and Trade		21,995		22,682		(687	)		20,393		119,121
Conservation		30,030		29,303		727			29,161		123,076
Infrastructure and Transportation		106,398		114,491		(8,093	)		104,225		527,011
Intergovernmental Affairs		30,845		31,655		(810	)		27,193		260,972
Science, Technology, Energy and Mines		21,476		15,262		6,214			15,363		81,060
Water Stewardship		6,373		6,799		(426	)		5,831		33,361
Total Community, Economic and Resource Development		250,494		249,170		1,324			226,963		1,402,232
Justice and Other Expenditures
Legislative Assembly		7,235		7,280		(45	)		12,782		35,064
Executive Council		881		887		(6	)		706		2,848
Civil Service Commission		1,426		1,496		(70	)		1,189		6,235
Culture, Heritage, Tourism and Sport		27,002		26,473		529			27,747		88,172
Employee Pensions and Other Costs		19,531		19,628		(97	)		18,138		79,604
Finance		33,441		35,269		(1,828	)		35,142		102,899
Healthy Child Manitoba		5,666		5,775		(109	)		5,548		27,180
Justice		57,890		58,490		(600	)		56,043		347,647
Labour and Immigration		9,537		12,510		(2,973	)		7,864		49,046
Manitoba Seniors and Healthy Aging Secretariat		279		311		(32	)		197		1,765
Enabling Appropriations		270		1,111		(841	)		230		122,095
Other Appropriations		4,662		5,319		(657	)		4,490		25,500
Less: Year-End Lapse		—		—		—			—		(65,000	)
Total Justice and Other Expenditures		167,820		174,549		(6,729	)		170,076		823,055
Debt Servicing Costs		51,554		46,572		4,982			75,823		262,500
Total Expenditure		2,374,091		2,382,271		(8,180	)		2,312,491		9,799,045

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PROVINCE OF MANITOBA APRIL TO JUNE 2008

Core Government Capital Investment Appendix III

UNAUDITED

	Year-to-Date to June 30									Full Year
	2008/09							2007/08		2008/09
($000s)	Actual		Estimated		Variance			Actual		Budget
General Assets
Government Services Capital Projects		12,398		16,085		(3,686	)		8,601		88,000
Transportation Equipment and Other Capital		193		2,253		(2,059	)		469		23,719
Information Technology Projects		766		621		144			600		19,805
Other Equipment and Buildings		—		55		(55	)		100		4,553
		13,358		19,014		(5,656	)		9,770		136,077
Infrastructure Assets
Provincial Roads, Highways and Airport Infrastructure		19,315		30,409		(11,095	)		24,294		249,883
Manitoba Floodway Expansion		9,650		21,415		(11,765	)		10,600		172,009
Water Control Infrastructure		365		482		(117	)		44		11,400
Parks, Cottage and Camping Projects		248		463		(216	)		845		9,711
		29,578		52,770		(23,192	)		35,783		443,003
Total Capital Investment		42,935		71,783		(28,848	)		45,553		579,080

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