BC Liberals: Balanced Budget or Wishful Thinking?

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The BC Liberals presented their 2013 budget on Tuesday, February 19. That is, they presented a barely balanced budget heavily dependent on resource revenues, a fire-sale of public assets and tax and fee hikes that made little mention of their “Families First” message.

Before they even started, the BC Liberals were forced to adjust their budget based on a quick skim by independent economist and former BMO chief economist, Tim O’Neill – he spent a week on this review compared to the months that he usually spends reviewing budgets. In his report, O’Neill wrote that natural gas rates have been overestimated by an average of $584-million each year. What would he find if he went through the budget more thoroughly? Yes, the BC Liberals have revised the budget based on this review but they will not publicly say how much they shaved off the budget.

They are also counting on Asian markets to scoop up British Columbia’s natural gas; however, in the budget speech the Hon. Mike de Jong said that natural gas revenues are down. If they already knew this, why are they basing an entire budget on these revenues? Additionally, they are operating under the assumption that these countries aren’t looking for their own natural gas or haven’t discovered natural gas already. Continuing to rely on resource revenue provides an uncertain future for B.C.’s economy which in turn affects B.C. families. This is not families first.

The budget projects to sell $625-million worth of public properties and assets including schools over the next two years. This is problematic for two reasons: The BC Liberals are expecting to unload $625-million worth of assets in a slow economy and this is a short-term band-aid that will only generate a temporary source of income over the next two years. Without the asset sales, the government will not balance its budget. This is not families first.

Then there’s the hidden tax increases in the budget. The BC Liberals are planning a four per cent increase in MSP premiums, further straining families that are already struggling to provide for their families. To put that in context, MSP premiums will be more than $2.39-billion by 2015 and corporate taxes will bring in $200-million a year. They also introduced a personal tax hike, but called it temporary – yeah right, we’re heard that before. This is not families first.

Throughout the speech, the Hon. Mike De Jong’s aim seems to be promoting jobs and helping families, but proposed investments in a few mega projects will only create jobs in select regions for isolated sectors of the economy. If the BC Liberals are so concerned with helping families, why are they investing in industries that require people to relocate rather than investing in local economies? This is not families first.

Furthermore, there are no major spending cuts outlined in his budget. His pledge to fix the books seems to depend on raising money, which we all know is not guaranteed. A successful balanced budget also needs significant spending cuts.  What the  BC Liberals presented was an election budget, not a real budget and it will not happen regardless of who wins on May 14. After the speech, Jane Sterk, Leader of the B.C. Green Party said “this budget does not present a solid vision for the future of British Columbia. Instead, the expenditures and investments seem to have been haphazardly derived”. The bottom line is: the BC Liberals say they balanced the budget but all I see are unreal expectations and sketchy numbers.

 

Written and researched by Victoria Cross, a Political Columnist for the Green Party of BC at Vancity Buzz. Connect with Victoria on Twitter at @VC_Ocean.

 

 

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