Finance Minister Katrine Conroy said Wednesday (Feb. 21) that B.C. will run a deficit for the second straight year amidst a slowing global economy, but added this is the wrong time to trim spending.
“Our budget is targeted to middle-class, average British Columbians that are struggling to make ends meet right now and we want to make sure that we are providing the support to people, the services to people,” she said. “We are not going to be cutting services and we are not going to be raising taxes on ordinary British Columbians.”
Conroy made those comments at a community centre in Victoria in anticipation of tomorrow’s budget. She said B.C. is not immune to global economic developments.
“We will see an increase in our deficit, because it’s the right thing to do right now,” she said. “We will have a declining deficit (over time). You will see that tomorrow.”
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Figures from November show the provincial deficit at $5.5 billion during the second fiscal quarter of 2023, down from $6.6 billion in the first fiscal quarter.
She also acknowledged concerns about the economic impact of three major resource projects winding down, including Site C. The Economic Forecast Council, an independent 13-member group of economists, raised that issue in December.
“But at the same time, we’ve got considerable other projects ready to go,” Conroy said. “So we are building hospitals, we are building schools, we are upgrading schools, we are building housing right across the province. So there will be employment for people.”
She added other, unspecific projects are on the table.
Looming over tomorrow’s budget is the introduction of a flipping tax, as promised by Eby. Conroy was asked if this not being the time to raise new taxes meant that tax would not be not in the budget.
“(This) is not the time to raise taxes for ordinary people. We don’t see ordinary people having to pay more taxes when they are already struggling and we want to make sure that we are continuing to provide services.”
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Conroy’s comments echoed comments Premier David Eby had made Tuesday in Vancouver, as well as parts of the Speech from the Throne, which hinted at additional relief for small business. Various groups have been lobbying the provincial government to raise the threshold on the Employers Health Tax.
Conroy’s budget also comes after Eby had said last fall that he is looking for affordability measures, hinting at a hydro rebate.
“I am absolutely looking for big affordability measures for British Columbians and I want them to shine,” he said. “I want British Columbians (to know) that we are delivering for them on affordability. I have asked every single minister, ‘Look at the your file, find ways to deliver affordability for British Columbians.’”
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Conroy said the budget will help British Columbians with day-to-day costs and to find the housing they can afford.
“It will also strengthen and protect health care in this province and Budget 2024 will build a stronger, cleaner economy with opportunities for everyone right across the province,” she said.
BC United shadow finance minister Peter Milobar said the NDP government doesn’t have a revenue problem, but a spending problem, while lamenting the high level of taxation.
“What the public cares about is actually their overall affordability in their individual households,” Milobar said. “We are hearing very clearly from them is that they want to see tax relief in a very real and tangible way, not just some big shiny announcement concocted by government trying to appease people for a month but doesn’t really have any long-term and sustained impact on their households,” he said.
Part of the government’s spending problem lies in the inefficient use of taxpayers’ dollars, Milobar added. The fact that government is planning to pay people earning up to $190,000 a subsidy to rent through BC Builds speaks to the growing unaffordability of B.C., he said.
“If ever there was something that would indicate just how far out of touch this government has become with people’s household costs, it’s probably the most latest announcement,” he said.
BC Green Leader Sonia Furstenau said she was disappointed the throne speech did not talk about inequality.
“We have a growing inequality crisis in this province and government has specific tools and mechanisms, investments it can make in order to alleviate the pressures of that inequality for a large number of people,” she said.
She said several areas of public life including transit and education are underfunded.
“So what I would like to see from a soc-called social-democratic government is investments into public services that will actually alleviate the enormous strain that is on British Columbians right now.”
Possible measures include a wealth tax or windfall profit tax.
“They need to cooperate with the federal government to achieve these,” she said. “We absolutely need mechanisms to address this growing inequality gap. I will see very disappointed if I don’t see action on that.”