British Columbia's budget forecast shows a surplus of $5.7 billion, dwarfing the previous estimate and giving the government room to help people facing the ongoing cost-of-living crunch, says Finance Minister Selina Robinson.
The projected surplus is $5 billion higher than the $706 million forecast last September, Robinson said Friday.
The latest fiscal update, covering the government's financial results from last April to September, puts the province in a “significant surplus position" to continue using its resources to deliver results on housing, public safety, health care and climate change, she said.
“Many British Columbians are feeling squeezed, feeling squeezed to put food on the table and cover costs,” she said at a news conference. “Our strong fiscal position means we can continue to put people first.”
Much of the added surplus comes from higher personal and corporate income tax revenues, at $3.7 billion, while sales taxes and natural gas royalties were also higher, Robinson said.
But the minister cautioned that such hefty surplus forecasts are not guaranteed to continue.
Robinson said B.C. is showing strong growth despite the ongoing pandemic, but the current numbers could be attributed to a "rebound."
"We also need to remember these numbers that we're seeing here, this is a shock rebound number," she said. "Whether they're going to hold over the long term remains to be seen. We don't know if these numbers are going to hold year over year."
Robinson said $2 billion of the added revenue has already been earmarked for cost-of-living measures announced since the summer.
Those include $1 billion for the Climate Action Tax Credit and BC Affordability Credit increases, $395 million for car insurance rebates and $320 million for a one-time electricity bill credit.
Since being sworn in on Nov. 18, Premier David Eby has made several spending announcements, including pledging $230 million in police funding to hire hundreds more officers.
Eby has said the B.C. economy is doing well and the province's budget can cover the cost of his latest plans.
“We will use these dollars we have to invest in things people need," Robinson said. "We’re in a strong position to continue making thoughtful decisions.”
But opposition parties say the New Democrat government has been holding back money while people are struggling to make ends meet during times of rising inflation and interest rates.
BC Liberal finance critic Peter Milobar said it appears the government withheld some relief initiatives until Eby took over from former premier John Horgan.
"Everyday people are now paying the price for his delays, despite the province having the money to provide relief," he said in a statement. "As these numbers make clear, the NDP have no excuse to avoid making much-needed investments in areas like health care, affordability, and mental health and addictions."
Green Leader Sonia Furstenau said the fiscal update shows the government has been failing to meet the needs of the citizens of B.C.
"For those who are struggling to pay their bills, cover the cost of groceries, find affordable housing, and access reliable health care, this budget surplus is an indication that the B.C. NDP government could have been doing more," she said in a statement.
Furstenau said the government had the money to raise social assistance and disability rates, build community health centres and invest in education, transit and housing, but didn't.
The fiscal update says the most recent private sector economic growth forecast now projects the B.C. economy to grow 2.8 per cent this year and 0.5 per cent in 2023.
Robinson said she will meet with economic forecasters next month to discuss the province's growth projections.
This report by The Canadian Press was first published Nov. 25, 2022.
Dirk Meissner, The Canadian Press