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BC may not meet balanced budget target, says finance minister

Finance Minister Kevin Falcon waffled today on whether or not British Columbia will meet it's goal of balancing the budget in the 2013-2014 fiscal year.

"It depends," he said. "Balancing in 2013-2014 is still possible as of today."

But if the economy continues to deteriorate in the United States and Europe, that will affect B.C., he said, adding that he wouldn't balance the budget "at all costs" at the expense of health care, education and other government programs.

Falcon made the comment during the presentation of the second quarterly report on the current budget year.

The province's projected deficit has grown by $313 million since the first quarterly report, presented three months ago, and $567 million since budget day, raising it to nearly $3.1 billion.

Nearly $150 million of the shortfall comes from ICBC, because of both higher than expected claims and lower investment income. A decline in corporate income tax accounts for $111 million of the deficit growth. Only $10 million is from increased spending.

Despite the gloom, the province didn't touch the $350 million forecast allowance or dip into the $600 million it budgeted for contingencies.

Falcon said he chose not to use those funds to make the books look better today, but allowed he could do so in the future. "It's unlikely we will utilize the forecast allowance," he said.

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

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