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New sales tax will help troubled economy: BC throne speech

Lieutenant Governor Steven Point today delivered a British Columbia government throne speech that promised to provide stability as the province deals with hard financial times.

The speech pitched the unpopular Harmonized Sales Tax as a way to strengthen the provincial economy.

“The government committed to work to make B.C. more competitive, reduce barriers to the economy and protect core public services,” it said. “A harmonized sales tax fits all three of those broad economic objectives.”

The government is moving to introduce the HST at a time when public finances are in serious trouble, it said. “The fiscal cupboard is bare and currently hangs on a wall of deficit spending.”

The $495-million deficit for fiscal 2009-2010 pledged in February, and repeated by both Premier Gordon Campbell and Finance Minister Colin Hansen during the campaign before the May 12 election, is widely expected to grow in the Sept. 1 budget even as ministries continue to make cuts.

“While we will protect critical health and education services, we will not throw up our hands, throw in the towel and borrow our way into oblivion,” the speech said. “We must minimize spending on non-essential services and target discretionary spending where it is needed most.”

Regardless, the speech warned, this year's deficit will be “far higher than originally forecast.”

It also made clear that the reviews of B.C. Ferries and Translink now underway are aimed at containing costs: “Public funding devoted to public transit and ferry services should not be used to subsidize unreasonably high compensation levels or administrative costs.”

Also of note:

* the province will review the spending by all health authorities, boards of education and Crown corporations;

* Crown agencies will be rolled into line ministries in cases where the ministries can do the job more cost-effectively;

* the government will introduce legislation to restrict drivers from using cell phones;

* the long-promised Lobbyists Registration Act will be have new investigative and enforcement powers added;

* the Police Amendment Act, which will strengthen the powers of B.C.'s police complaint commissioner, will be reintroduced;

* the province will begin denying welfare to anyone in B.C. who has an outstanding warrant from another province;

* the government reintroduced the idea of full-day kindergarten, saying it will be in place for Sept. 2010;

* “A new wood first policy will . . . require all public buildings to use wood first as their default building material, inside and out”;

* the speech talked about the commitment to reconciliation with First Nations, but failed to mention the recognition and reconciliation legislation floated before the May election;

* it also appeared to acknowledge that “Green” energy projects are largely for electricity export: “This government will capitalize on the world's desire and need for clean energy, for the benefit of all British Columbians.” A new task force will be appointed to “recommend a blueprint for maximizing British Columbia's clean power potential, including a principled, economically-viable and environmentally-sustainable export development policy.”

The full text is available on the government's website.

Andrew MacLeod is The Tyee’s Legislative Bureau Chief in Victoria. Reach him here.

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