B.C. posts balanced budget, pledges more money for low-income families
$274M surplus assumes billion-dollar deficit for ICBC will be wiped out
New subsidies for families and the elimination of interest on student loans were the big announcements in what was primarily a status-quo budget delivered by the B.C. government on Tuesday.
Finance Minister Carole James announced the elimination of operating debt for the first time in 40 years, an estimated surplus of $274 million for 2019/2020, and a forecasted surplus of $374 million for the current fiscal year.
"British Columbia is thriving," said James.
"We have a balanced budget across the fiscal board. We're the only province with a AAA credit rating. But we will never have a truly prosperous province unless everybody can share in that prosperity."
While James' second full budget didn't have the same blockbuster announcements such as the elimination of Medical Service Plan premiums or property speculation tax as her first budget, several new policies were introduced that build upon the government's commitment to provide more funding to the less wealthy.
"The past government prioritized surpluses for the sake of surpluses. We're investing in a blanketed approach," said James.
Funding for families with children
The biggest new program is the B.C. Child Opportunity Benefit, which will give money to approximately 60 per cent of families each year, based on their income level and number of children under 18.
Beginning in October 2020, it will replace the Early Childhood Tax Benefit, which ends at six years of age, and will cost an additional $250 million each year.
"We really want to make sure we have the opportunity for every child to thrive," said James.
Families making less than $25,000 will receive $1,600 annually if they have one child, and $2,600 annually if they have two children. The amount decreases based on family income, and isn't available for families making more than $97,487 with one child or $114,487 with two children.
"Anyone who's raised a child knows how transformational that support can be. These kinds of dollars are going to make a significant difference in families' lives."
Other new commitments include a dedicated fund from gaming revenue for First Nations communities, an increase of $50 a month to welfare and disability payments, and new funding for foster care parents.
More money was also promised for modular housing — intended for areas where homeless camps come up — and further investments into clean energy programs.
But the government's forecasted surplus is predicated on a number of factors, including property transfer taxes remaining stable, wildfire costs going down after two record-setting years — and most crucially, reforms to the Insurance Corporation of British Columbia to eliminate the billion-dollar deficits the crown corporation has suffered the last two years.
"We're dealing with back claims right now, but because we're dealing with so many back claims, we'll be better off as we go ahead," said James, who said she was "pretty confident" the forecast would be met because of the reforms that take effect on April 1.
At the same time, the government's own budget documents said "there is a particular risk that changes to claims costs trend within ICBC, given recent volatility, will impact the corporation's financial result."
Greens pleased, Liberals not
Reaction from the B.C. Liberal party was negative, as expected.
"The NDP don't really have a plan to make B.C. a better place. They want to massively increase spending over the term of their government," said Liberal Leader Andrew Wilkinson.
"The economic winds are changing. There are dark clouds on the horizon." See B.C. Liberal Leader Andrew Wilkinson respond to the 2019 budget. <a href="https://twitter.com/hashtag/bcpoli?src=hash&ref_src=twsrc%5Etfw">#bcpoli</a> <a href="https://twitter.com/hashtag/bcbudget19?src=hash&ref_src=twsrc%5Etfw">#bcbudget19</a> <a href="https://t.co/iEIc5IKZYv">pic.twitter.com/iEIc5IKZYv</a>—@cbcnewsbc
He was critical of the lack of tax relief in the budget and argued future budgets from the government wouldn't be nearly as fiscally healthy.
"This is a government that's treading water knowing that housing starts are dropping. Resource revenues are dropping, they say by 20 per cent. The world's economy is slowing down dramatically, and they're pretending it's all going to be okay."
However, the minority government's ability to pass legislation has always rested on the continued support of the Green Party — and they had high praise for the budget.
B.C. Green Leader Andrew Weaver hasn't always seen eye to eye with the B.C. NDP. What does he think of their government's latest budget? <a href="https://twitter.com/hashtag/bcpoli?src=hash&ref_src=twsrc%5Etfw">#bcpoli</a> <a href="https://twitter.com/hashtag/bcbudget?src=hash&ref_src=twsrc%5Etfw">#bcbudget</a> <a href="https://t.co/W4ljsiNXBP">pic.twitter.com/W4ljsiNXBP</a>—@cbcnewsbc
"This is a good budget," said Green Party Leader Andrew Weaver, who mentioned new funding and subsidies for clean energy programs and the elimination of student loan interest as specific areas his party pushed for.
"While we may not have done things exactly that they would like they did, overall we're pleased with the general sense of direction of this budget and we'll be supporting this in the upcoming vote."