Finance Minister Carole James at the B.C. legislature, Nov. 26, 2019. (Tom Fletcher/Black Press)

Consumer spending ‘cautious,’ B.C. finance minister says

Carole James sees housing sales pick up, resources in decline

The B.C. government continues to reduce its expected surplus this year, as consumer spending cools off and revenue from forest products and other resources declines.

Finance Minister Carole James released the province’s second quarter financial results Tuesday, showing $133 million reduction in expected forest revenues for the year ending next March. Coal, electricity and oil and gas revenues have also seen a reduction in revenue forecasts, with natural resource revenues in general down $235 million from the first quarter estimate.

Income tax revenue forecasts are up, based on B.C.’s continued strong population and employment growth, but consumer spending is slowing down. James said that is due to economic concerns, both in B.C. and globally.

Retail sales grew by only 0.6 per cent during the first six months of the 2019-20 fiscal year, continuing a slowdown from 9.3 per cent growth in 2017 and two per cent last year. The slowdown is primarily “a decline in housing-related spending and new vehicle sales,” James said.

Average home sale prices fell by 3.3 per cent up to October 2019, after a slight increase in 2018. Housing starts are up so far in 2019, with 45,112 starts so far in 2019 compared to 40,857 in 2018.

RELATED: ICBC improving, still not out of the red, minister says

RELATED: Population, low mortgage rates drive housing recovery

Revenue forecasts for the B.C. Lottery Corp. and Liquor Distribution Branch are down from the September forecast, with lower casino revenues and sluggish sales for legal marijuana in B.C. James said there is some improvement in sales from B.C. Cannabis and private retail stores, but it is too soon to say if the province will break even on cannabis sales in the current year.

“B.C. Liquor Distribution Branch net income forecast has declined $18 million due to the delayed rollout of private and public cannabis stores and lower than anticipated demand,” the second quarter report states.

James said other cost-saving measures are in the works for ICBC, which saw billion-dollar losses the last two years before a cap on “pain and suffering” awards and diversion of smaller injury claims from court took effect in April. The budget continues to carry a $500 contingency fund to cover ICBC losses this year, as higher premiums and a new risk-based rate system come into effect.

Overall, the province now projects a surplus of $148 million, down from $179 million in the September update.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislature

Comments are closed

Just Posted

B.C. Supreme Court dismisses claim against Island Corridor Foundation

Snaw-Naw-As (Nanoose) First Nation was seeking return of reserve land as railway sits unused

Saanich woman says sexual assault was dismissed by police because of her ‘body language’

Patrol officers investigate sexual assault files, make decisions on what goes to Crown counsel

‘Tarantula moth’ spotted in broad daylight in Victoria

Polyphemus moths are one of the largest insects in B.C.

Man dies at temporary Duncan tent site for homeless

First Nations man died at The Mound site

Loaded gun, hundreds of rounds ammunition seized in Victoria

Victoria police focus on Project Burnside Gorge Connect

All community COVID-19 outbreaks declared over in B.C.

Abbotsford manufacturer cleared by Dr. Bonnie Henry

Nanaimo RCMP issues warning about scam phone calls

Callers claiming to be government officials convince victims to buy Bitcoin

B.C. reopening but tourism facing long-term recovery, say Vancouver Island MLAs

B.C. Liberals criticize lack of planning, NDP says consultation and response happening

Minivan crashes into building in downtown Duncan

No word yet on the cause of the crash

‘Queue jumpers’ not welcome in B.C. as COVID-19 U.S. cases rise: Horgan

Premier Horgan said he’s heard concerns that Americans have stopped at Vancouver hotels instead of heading to their destination

Trio of Vancouver Island fire deparments respond to barn blaze

Oyster River, Courtenay and Campbell River fire departments all respond to incident

B.C. First Nations vow to keep fighting after Trans Mountain pipeline appeal denied

Squamish Nation, Tsleil-Waututh Nation and Coldwater Indian Band made the application

US officer resigns after photos, connected to death of black man in 2019, surface

Elijah McClain died, last summer, after police placed him in a chokehold

Most Read