Despite Deficit, NDP Says No Spending Curbs

Despite British Columbia’s growing deficit, the government intends to keep spending to support people, Finance Minister Katrine Conroy said while presenting a quarterly budget update Tuesday that added $1.1 billion to this year’s deficit.

Nor did Conroy rule out the announcement of new payments to individuals and households before the Oct. 19 election, but she said those commitments would likely come through a party platform rather than the Finance Ministry.

“Some say we should balance the books now, but this would mean making cuts or increasing fees,” said Conroy, who is not running for re-election. “This would mean fewer teachers, nurses, schools and hospitals for people. It’s just not the right time. We can’t leave people to fend for themselves.”

The quarterly update showed that in the first three months of the fiscal year that started March 31, the deficit had grown to $9 billion, with increased expenses for fire management ($653 million), lower revenue from corporate income tax ($638 million) and higher debt servicing costs ($344 million) among the main reasons.

The province still has the financial strength to navigate future challenges while growing the economy, said Conroy, pointing out that B.C.’s debt-to-GDP levels — though rising — remain significantly lower than those carried by the federal, Ontario and Quebec governments.

She also noted that the current year’s budget includes $3.9 billion for contingencies that has not been allocated.

“We’re going to continue to support people without making cuts, without making cuts to services, without increasing fees,” Conroy said, adding that the only people the government has increased income taxes for is the top two per cent of earners.

The government has been focused on supporting people since it was first elected in 2017 and that will continue, she said. “I’m sure you’ll hear that in the election, that kind of theme.”

As the election nears, a major polling firm working for an unidentified client has been surveying public support for various measures aimed at making life more affordable.

Proposals being tested by the client include:

• making a one-time “BC Grocery Rebate” of $500 to individuals and $1,000 to households “to help offset the rising cost of groceries” that would be available to 90 per cent of British Columbians;
• introducing a temporary cost-of-living tax credit that for two years would give individuals $500 and households $1,000 that would also go to all but the richest 10 per cent in the province;
• making a credit of that same size permanent as a “BC Benefit Payment” that would be bundled with other provincial affordability benefits like the B.C. family benefit, carbon tax rebate and renter’s rebate into “a single regular payment that people can count on”;
• eliminating income taxes on the first $50,000 of income for everyone in the province, as BC United had proposed shortly before the party suspended its campaign, but with the difference that the cut wouldn’t extend to anyone making more than $250,000 a year;
• eliminating the carbon tax and instead “make big polluters pay”;
• introducing an age-based tax cut that would eliminate income taxes for anyone under the age of 35 who earns less than $100,000 and anyone under the age of 40 earning less than $60,000 but keep taxes the same for anyone over the age of 40; and
• implementing a “lower- and middle-income tax cut” that would see 90 per cent of households getting $1,000 back.

Asked what the government may be considering to help with affordability and whether it’s the right time to spend more on new benefits for people, Conroy said, “From my perspective we have shown very clearly how we are going to support people.”

She pointed to measures the government has taken since 2017 including the B.C. family benefit, funding for schools to provide hot lunches, free birth control and lower rates for ICBC and BC Hydro.

“People just need to look at our actions,” she said. “No financial decisions will be made now because you can’t fetter a future government, so any decisions that will be made will be made during a platform decision during the election, so stay tuned.”

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