The next step in the Manitoba government's plan to tackle what it calls a top-heavy public sector is a 15 per cent cut in overall management levels.

"Taxpayers' dollars should be prioritized on front-line services — next to the student, the ratepayer and the customer — for better outcomes," Finance Minister Scott Fielding said in a news release Thursday.

The government is also directing Crown corporations, post-secondary institutions and school divisions to control executive compensation. That includes a 1.75 per cent cap over four years and bringing in outside consultants to review salaries.

Manitoba Hydro, Manitoba Public Insurance and Manitoba Liquor and Lotteries were told in 2016 to cut upper management by 15 per cent as part of the government's drive to reduce the deficit.

The Progressive Conservatives were re-elected with a second consecutive majority last September after promising to continue to cut the deficit and taxes. They said they would gradually phase out education property taxes starting in 2023, once the budget was balanced.

School review coming soon

A review of kindergarten to Grade 12 education is also expected in the coming months. Officials have said all options are on the table to improve grades and control costs, including removing or reducing the number of school boards.

Also on Thursday, the government announced a boost in funding to public elementary and high schools by half a percentage point, as well as a two per cent cap on school property tax for the third year in a row. It amounts to an overall funding increase of $6.6 million.

Education Minister Kelvin Goertzen said any savings from managerial cuts will be funnelled into education.

"Clearly we are asking school divisions to live within the means of taxpayers and live within the means of the ability for Manitobans to pay," Goertzen said.

Opposition member Matt Wiebe said the minor funding increase is incredibly frustrating.

"Once again we've seen a de facto cut to the classrooms in Manitoba."

Small divisions already lean

"We weren't surprised," said Alan Campbell, President of the Manitoba School Boards Association.

"As publicly funded institutions, we expected a direction of this kind....School boards have been preparing based on speculation and now that we have it on paper from the minister, we'll proceed to develop our budgets," he said.

Campbell said smaller school divisions especially could have issues making the directive.

"In many ways, small divisions, especially rural school divisions, already run very lean when it comes to senior leadership, relative to budget," he said. "Fifteen per cent will be a challenging number to accomplish, not impossible, but certainly challenging."

Goertzen said school divisions will be allowed to choose where to use the money, but the government has directed it should go to classrooms and the front lines.