B.C. budget 2021: Deficit to grow due to COVID

Overall, Kamloops opposition B.C. Liberal MLAs Todd Stone (Kamloops-South Thompson) and Peter Milobar (Kamloops-North Thompson) felt the budget was disappointing, noting there was no mention of Kamloops-specific items, such as the NDP’s promised cancer centre or a foundry centre for youth.

B.C.’s current COVID-19-driven deficit is coming in at $8.1 billion, not the $13.6 billion that was projected, but the province has much more borrowing ahead to recover from the pandemic.

Finance Minister Selina Robinson laid out the NDP government’s three-year budget on Tuesday, calling for a further $19 billion in borrowing to build up the health-care system and carry on support programs for individuals and businesses. Income and property purchase taxes have pushed provincial revenues higher than forecast.

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“The swift development of effective vaccines, together with stronger than expected economic activity in 2020 has improved the outlook,” Robinson told reporters in a virtual budget presentation from Victoria.

Overall spending will increase by $8.7 billion over the three years of the budget, including “permanent funding increases” for health care, education, justice and public safety services and opioid and substance abuse prevention.

Overall, Kamloops opposition B.C. Liberal MLAs Todd Stone (Kamloops-South Thompson) and Peter Milobar (Kamloops-North Thompson) felt the budget was disappointing, noting there was no mention of Kamloops-specific items, such as the NDP’s promised cancer centre or a foundry centre for youth.

Stone also noted no new school capital dollars were included for the Kamloops-Thompson school district beyond the Parkcrest school replacement, which is an insurance claim due to its destruction by fire and not a capital project.

On the bright side, Milobar, as critic for Indigenous relations, and Stone said they were pleased to see the government commit $60 million to more thoughtful consultation with First Nations communities.

“That was nice to see,” Milobar said. “It’s not going to have to be done on a shoestring.”

Deficits are forecast to be $9.7 billion in the fiscal year just beginning, declining to $5.5 billion in 2022-2023 and $4.3 billion in 2023-2024.

Among those permanent increases is an additional $175 per month in income and disability assistance payments, on top of $150 from previous NDP budgets, and a $50 increase in the seniors’ supplement.

Spending commitments also include another $100 million to continue B.C. Recovery Benefit payments of up to $1,000 per family and $500 for individuals, announced before last fall’s election.

The program has paid out $1.2 billion without requirement to show pandemic income loss, and remains open for applications until June 30.

Uncertainty over B.C.’s recovery from the COVID-19 pandemic continues to weigh on the province’s forecasts.

The finance ministry has included pandemic and recovery contingency funds of $3.25 billion in 2021-2022, $1 billion in the following fiscal year and $800 million in 2023-24.

In health care, contingency funds of $1.5 billion for 2022-2023 and $2 billion for 2023-2024 are included “for caseload pressures and priority initiatives that may require funding in future budgets.”

Health Minister Adrian Dix said this week that rising numbers of COVID-19 patients coming into hospitals have already resulted in some patient transfers and scheduled surgery delays, and bed capacity is nearing its limits as coronavirus cases have been running at close to 1,000 per day.

After the B.C. economy shrank by 5.5 per cent in 2020, the budget predicts it will expand by 4.4 per cent in 2021, and then grow by 3.8 per cent in 2022.

From 2023 to 2025, the growth forecast is 2.1 to 2.5 per cent per year, below the government’s private sector forecast council except for 2025, when the province expects to see LNG Canada’s natural gas exports begin.

OVERDOSE CRISIS AND MENTAL HEALTH SUPPORTS

B.C. has earmarked a historic half-billion dollars to focus on mental health and addiction services over the next three fiscal years, as part of the province’s 2021 budget.

“The COVID-19 pandemic is not the only health emergency facing our province,” Robinson said.

A majority of it, $330 million, will go towards substance-use treatment and recovery services in the province, including $152 million to address the opioid crisis and for the creation of 195 new treatment and recovery beds.

Robinson noted the COVID-19 crisis has highlighted the importance of mental health, including the challenges faced by youth.

As part of an additional $97 million to be spent on mental-health initiatives for children and youth, 15 more school districts in B.C. will see integrated teams of mental-health and substance-use clinicians and Indigenous workers be able to provide quicker, more direct support to students.

Foundry centres that offer mental health and substance use services for British Columbians aged 12 to 24 will also double, from 11 locations to 22.

© Kamloops This Week

 


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