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Stay-the-course budget keeps 'flexibility' for next premier

Provincial government revenues from natural resources have fallen while the amount collected with the Harmonized Sales Tax has increased, according to budget documents Finance Minister Colin Hansen presented today.

And while the deficit for fiscal 2010-2011 shrank to $1.3 billion from a projected $1.7 billion, the province's total debt is expected to reach a level in 2011-2012 equal to a year's revenue.

Hansen criticized media reports suggesting today's budget will never be debated and will be rewritten by whoever becomes premier when the BC Liberals pick a new leader Feb. 26. "This is a budget that could very well be passed by the legislature," he said.

The budget keeps as much flexibility as possible and includes large contingencies the new premier and cabinet can decide how to spend, he said. It includes a $350 million forecast allowance and $600 million for contingencies.

Natural gas revenues for the 2010-2011 fiscal year dropped from a budgetted $698 million to $365 million, according to the updated forecast, and forest revenue was off by $69 million.

The province also received less money than expected from Crown Corporations. While revenue from ICBC was up 19 percent from last year's budget, BC Hydro (7.5 percent), the liquor distribution branch (7.9 percent) and the BC Lottery Corporation (3.2 percent) were all below expectations.

At the same time, corporate income taxes were 93 percent higher than expected and HST revenue was 10.2 percent higher than expected. Income from the carbont tax was up slightly.

Several of the ministries show decreases in later years of the three-year plan. A finance ministry official said these were for things like the LiveSmart program and community courts that were funded for several years, but that it will be up to the cabinet to decide whether to continue and that there would be contingency money available for them if they decide to.

Liberal members will vote on Feb. 26 for a new leader to replace Premier Gordon Campbell.

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

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