The B.C. NDP government’s latest budget carries on with its post-election program of subsidized housing, climate measures and taxes, while building up capital debt to record levels for hospital upgrades, transportation and other public works.
“The scale of change is staggering,” Finance Minister Carole James told the legislature as she presented the third full budget of the minority NDP government this week. “$18 billion worth of work is happening in all corners of the province.”
B.C. Liberal opposition critics pointed to stalled housing numbers and other signs of an economic slowdown, and tax increases including extension of provincial sales tax to streaming services. B.C.’s core natural resource revenues are also expected to remain low over three years, down by almost $1 billion from two years ago due to low lumber, coal and natural gas prices.
The budget offered little new for the forest industry, as loggers rallied outside the legislature, with a $13 million fund to pursue the government’s waste wood recovery and delivery of a $69 million package for communities that have lost sawmills.
The budget adds a new top tax bracket for high income earners, and extends the seven per cent sales tax to sweetened carbonated drinks, including sugar-free products.
Former B.C. Green leader Andrew Weaver said he is “delighted” with the budget, including one of its few new spending measures, a grant program for post-secondary studies including diplomas and certificates under two years.
Now sitting as an independent, Weaver has pledged to continue supporting the NDP minority through the spring budget, despite his opposition to the government’s Site C dam and LNG Canada commitments.
The capital plan for three years is $7.4 billion for projects including highway projects in Delta, Langley and on the south coast of Vancouver Island, the Pattullo Bridge replacement for Surrey, the Broadway subway in Vancouver and further four-laning of the Kicking Horse Canyon.
The budget projects a $91 million deficit for the Insurance Corp. of B.C. for the current year, with small surpluses in the next two years as Attorney General David Eby moves injury claims from courts to a civil resolution tribunal that is already handling smaller disputes. ICBC lost $2.5 billion in the previous two years.
The budget projects small operating surpluses for three years, helped by personal and business income tax revenue and strong employment from projects including the Trans Mountain and Coastal Gaslink projects.
Public project spending is set to push B.C.’s capital debt to $87.6 billion by 2022, but that level “remains very manageable at 17.1 per cent of Gross Domestic Product, said Bryan Yu, deputy chief economist at Central 1 Credit Union.