VICTORIA (NEWS1130) – It’s Budget Day in BC. BC’s finance minister had promised a status-quo budget and he has delivered. The financial blueprint contains no major spending plan.
Colin Hansen has announced the provincial deficit is dropping from $1.75 billion to $1.2 billion, thanks to rising revenues. The deficit should turn into a $175 million surplus by 2013-14.
However, BC’s debt, which was pegged at $36 billion in 2004, is slated to rise to $60 billion by 2014 without any interest rate hikes.
The province will spend $3 billion on paying interest on the debt which is more than the government spends on any ministry, except health and education.
Hansen points out the budget is based on keeping the HST, and if British Columbians vote to scrap the tax, the government would have to return $1.6 billion to Ottawa.
Reaction from business and labour
Irene Lanzinger with the BC Federation of Labour calls the budget disappointing. “This is status quo, but we want better next time. We want a job creation strategy. We want a poverty reduction strategy as we have the highest child poverty rate in the country. We want a raise in the minimum wage.”
Scotiabank economist Mary Webb says it is an encouraging budget. “Many fundamental decisions are later this spring and summer. So for this province, the quarterly updates are going to be disproportionally important.”