Opinion: Finance minister says balanced budget is the NDP goal, but no hint of when that might be achieved. Not soon, for sure
VICTORIA — Finance Minister Katrine Conroy made no apologies Thursday for bringing in a three-year budget and fiscal plan that was awash in an atmospheric river’s worth of red ink.
Conroy budgeted for three years of operating deficits totalling $22 billion, double her forecast this time last year in her first budget as finance minister in the David Eby NDP government.
Subscribe now to read the latest news in your city and across Canada.
Subscribe now to read the latest news in your city and across Canada.
Create an account or sign in to continue with your reading experience.
The revised three-year plan also calls for adding $61 billion in debt, leading to an almost 60 per cent increase in the total provincial debt since Eby took office.
Yet Conroy maintained all these deficits and debt represented “tough” but unavoidable choices in challenging times.
People need help to make ends meet, she argued. They are more dependent than ever on government services. She suggested that only a heartless right-wing government would have tried to manage spending and borrowing to different results.
Alas for her, to imagine an alternative, there is no need to think back to the dark, satanic budget-making of the last B.C. Liberal government or the presumed scorched-earth election platforms of the B.C. United and B.C. Conservative parties.
The John Horgan NDP government took power with an ambitious agenda and a determination to increase funding to services that were neglected by the previous B.C. Liberal government.
It also governed through a genuine crisis during the COVID-19 pandemic.
Nevertheless, Horgan and his two finance ministers, Carole James and Selina Robinson, managed to deliver four surplus budgets in six tries.
Stay on top of the latest real estate news and home design trends.
By signing up you consent to receive the above newsletter from Postmedia Network Inc.
A welcome email is on its way. If you don't see it, please check your junk folder.
The next issue of West Coast Homes will soon be in your inbox.
We encountered an issue signing you up. Please try again
Their one substantial deficit was a record setting $5.5 billion, but that was in the worst year of the pandemic.
As Eby’s finance minister, Conroy is proposing to break that deficit record by a wide margin in each of the next three years.
Horgan, despite the pandemic, wildfires, flooding and other challenges also managed to completely retire the province’s operating debt, leaving behind a burden of zero dollars in that category of debt at the end of his last year in office.
Conroy, on Eby’s behalf, is proposing to boost the operating debt to an unprecedented $22 billion over just the next three years.
The plan calls for boosting other kinds of debt as well, including debt undertaken to build infrastructure and that incurred by both taxpayer-supported agencies like B.C. Housing and ratepayer-supported Crown corporations like B.C. Hydro.
All in, the Eby government proposes to boost the total provincial debt to $165 billion, almost double what it inherited from the Horgan government.
Nevertheless, Conroy insists “our debt burden remains manageable.”
For now, yes. But in large measure, it is manageable because previous governments managed debt and borrowing within reasonable limits.
In tribute to the Horgan government’s relative prudence on fiscal matters, the debt-rating agencies maintained it at the same top-rank credit rating inherited from the B.C. Liberals.
That record is why B.C. had ample leeway to borrow at the best rates and spend heavily when hit by the genuine crisis of the pandemic.
Asked about the possibility that the Eby government will be downgraded on the favourable credit rating inherited from the Horgan government, Conroy said “I’m not going to presume what the rating agencies are going to do.”
Her best hope is that the agencies will cut her some slack because she socked away $11 billion in unallocated contingency funds. Enough to cut the projected deficits in half if used to cover operating costs.
Unless, of course, Eby follows past practice — he spent most of the $6 billion that Horgan left behind in his last budget — and allocates much of the contingency funding to election-type promises.
Conroy hinted there’s more to come, when she told reporters “there would be a lot more in the budget if we were just focusing on the election.”
When governments get into the habit of spending like this one, there are few constraints and next to no incentives to manage the budget.
Witness this government’s record on hospital projects.
This time last year, Conroy released a capital plan that budgeted the new Surrey hospital and cancer centre at $1.724 billion.
Then at the groundbreaking ceremony in September of last year, Eby disclosed that the projected cost had soared to $2.88 billion — a 67 per cent increase before there was one shovel in the ground.
The new hospital in Dawson Creek is 59 per cent over budget, the new one in Williams Lake is 68 per cent over and the costing on the Cowichan District Hospital has climbed 63 per cent higher than the initial estimate in the NDP capital plan.
Conroy blamed the overruns on the usual suspects — inflation, supply chains, shortages of workers and materials.
Those factors have been well known for some time. A prudent government would have taken them into account before including such fanciful numbers in its capital plan.
Toward the end of the news conference Thursday, Conroy was asked if there ever would be a right time for the Eby government to balance the budget.
“Our goal is to have a balanced budget,” she replied.
Perhaps they do have a goal. Just not on any timetable they are prepared to share with the public.
vpalmer@postmedia.com
Bookmark our website and support our journalism: Don’t miss the news you need to know — add VancouverSun.com and TheProvince.com to your bookmarks and sign up for our newsletters here.
You can also support our journalism by becoming a digital subscriber: For just $14 a month, you can get unlimited access to The Vancouver Sun, The Province, National Post and 13 other Canadian news sites. Support us by subscribing today: The Vancouver Sun | The Province.
Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.
login
who are we?
contact us
qosheapp
Toi Staff
Gideon Levy
Belen Fernandez
Rami G Khouri
Mort Laitner
Ali Fathollah-Nejad
Nikkei Editorial
visit website
