Finance Minister Colin Hansen presents his budget in Victoria last Tuesday.  Included is a $150 million contingency fund for the incoming Premier when Liberal party members elect a new leader this coming Saturday.

Finance Minister Colin Hansen presents his budget in Victoria last Tuesday. Included is a $150 million contingency fund for the incoming Premier when Liberal party members elect a new leader this coming Saturday.

MLA Norm Letnick comments on provincial budget

MLA Norm Letnick says province continues deficit spending but will return to a surplus budget by 2013 fiscal year.

For 2011 British Columbians can expect similar levels of service from their government as were experienced last year. Finance Minister Colin Hansen presented the provincial budget last week granting similar levels of funding to the government’s various departments.
“It’s a status quo budget that we have prepared but there is some room for flexibility in it,” says MLA for Kelowna – Lake Country Norm Letnick. “Depending on who our new Premier is we could still see some changes.”
The budget estimates a deficit of $1.3 billion at the end of the current fiscal year, which finishes at the end of March. 2011 and 2012 are also forecast as deficit years that will add $925 million and $440 million respectively to the provincial debt.
The government expects to return to more prosperous times in 2013 with a budget surplus of $175 million. When the surplus is achieved Letnick says that it can be used to start paying off the provincial debt, which is projected to reach $60.4 billion by the end of the 2013 fiscal year.
“We’ve just come through the most serious recession since the depression,” says Letnick. “It takes time for government to recover because business has to recover first.”
Despite describing the budget as status quo, Hansen did announce new funding for several departments.
The Ministry of Health Services will see the largest increase at $605 million but, it will have to wait until 2013 to receive the funding boost.
The Ministry of Social Development receives $65 million over three years for income assistance programs.
$150 million has been budgeted as a contingency for the incoming Premier and his or her executive council. The money will provide flexibility in the budget, to give the new leadership an opportunity to steer the province toward their interpretation of the public will.
Another issue that has the potential to significantly affect the budget is the upcoming HST vote. Letnick says that the financial implications would include refunding the federal government’s $1.6 billion in transitional fees that it paid to B.C. for harmonizing the PST with the GST. There would also be additional costs associated with returning to the old tax structure. An exact figure is has not yet been determined, however, and independent panel has been commissioned to find the answers.

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