Finance Minister Carole James (Black Press)

Surplus decreased as B.C. wildfire, ICBC costs rise

Finance Minister Carole James promises balanced budget

B.C. Finance Minister Carole James released the province’s second quarter financial update Tuesday, downgrading the forecast surplus for the current year and using the bulk of the government’s forecast allowance to keep the books out of the red.

The projection at the halfway point of the 2017-18 fiscal year is a surplus of $190 million, down $56 million from the first-quarter projection. The biggest jump in provincial spending was $152 million to cover costs of the summer forest fire season. Forest fire efforts also accounted for most of a jump of 267 full-time equivalent B.C. government jobs in the summer.

On the revenue side, the biggest change was a reduction of $643 million in anticipated income tax revenues. James said that was based on the federal government’s update of personal and corporate income taxes collected during 2016, down from the previous forecast.

Another revenue drop of $109 million from earlier forecasts came in commercial Crown corporation revenue. That is mostly due to a downgrade of revenues from ICBC, which continues to struggle with increased claims and legal costs.

RELATED: Report warns of more ICBC rate increases

Other revenues continued at a healthy pace in the quarter from July to September, including property transfer tax, which has been the province’s cash cow during the hot real estate market in recent years. Expected revenues from that tax for the current year were increased by $175 million.

Retail sales also continued to rise in the second quarter, resulting in an upward adjustment of $51 million.

Another bright spot was forest revenues, with the provincial revenue forecast up $55 million, due mostly to higher timber tenure stumpage rates. B.C. lumber prices are near record highs, with high demand from the U.S. despite 20 per cent countervail and anti-dumping duties imposed by the U.S. government at the Canadian border.

B.C. Liberal finance critic Shirley Bond said the strong economic growth is a result of the previous government’s policies.

“Although the NDP inherited a $2.7 billion surplus, they have already managed to dip into British Columbia’s savings and they haven’t even fulfilled most of their major campaign spending promises, including $10-a-day daycare and a $400 renter subsidy,” Bond said.

James said the NDP’s child care and housing pledges are over 10 years, and can be achieved as long as B.C. continues to have strong economic growth.


Like us on Facebook and follow us on Twitter.

Just Posted

Missed a week of news? We’ve got you covered

Every Saturday, we post popular stories from the week

Long-time Hedley fan weighs in on concert

Davis Wiggs attended Hedley’s final show last night

Kelowna couple hoping for a miracle

Endang Suslash is hoping to stay in Canada so she continue receiving treatment for kidney failure

Highway potholes under ministry jurisdiction

The District of Lake Country doesn’t touch the highway when it comes to filling potholes

Embattled band Hedley plays last show in Kelowna before hiatus

About 3,000 tickets had sold for final performance at Prospera Place

Bottle drive held for Kelowna fire victim’s family

Springfield Elementary held a bottle drive today to support the Van Gool family

B.C. umpire has developed thick skin after 30 years listening to insults

Scott McLaren pays no mind to comments from the cheap seats

Musicians Sarah Harmer, Grimes join B.C. anti-pipeline protests

Musicians are in Vancouver for the Juno Awards on Sunday night

Canadian cities hold March for our Lives events in wake of Florida shooting

Hundreds of people support the massive March for Our Lives event in Washington, D.C.

Health officials called after acid spill near B.C.-Alberta border leaks into creek

Tanker truck crashed south of Dawson Creek, spilling 17,000 litres of hydrochloric acid

Trudeau to exonerate B.C. First Nations chiefs hanged in 1860s

Prime Minister to absolve Tsilhqot’in chiefs in relation to deaths of 14 construction workers

Snowfall warning for Highway 3

Kelowna - A snowfall warning is in effect from Paulson Summit to Kootenay Pass

Canucks sing the Blues as they fall to St. Louis 4-1

Berglund nets two, including the game-winner, to lift St. Louis over Vancouver

How to keep local news visible in your Facebook feed

Facebook has changed the news feed to emphasize personal connections. You might see less news.

Most Read