BC NDP delivers election year budget with billions in spending and billions more in debt

FORT ST. JOHN -- British Columbia’s majority NDP government delivered its 2024 budget on Thursday, forecasting a deficit in order to maintain services and promised infrastructure spending, while promising rebates and other goodies during an election year.

The provincial budget for 2023-24 is estimated at $89 billion, and includes the housing initiatives, including BC Builds, the government has been announcing and promoting in recent months.

The NDP is adding $22.4 billion to the provincial debt in the next three years.

Peace River South MLA, Mike Bernier said, "It's pretty scary when you look at what the NDP government are doing right now, how they're spending more and more, but we're getting worse results. We've never seen things worse in our health care system, our education system. We see no money being spent in our transportation infrastructure, but yet they've managed to increase the deficit,”

One-time rebates for electricity and BC Family Benefits increases, in addition to implementation of a long-discussed renters’ rebate, could see a low-income family with an extra $1,060 in their bank accounts.

Government priorities include a focus on the middle class, families, and housing, whichthey have clearly signalled in recent months with a slew of announcements and public statements.

$6 billion in increased health-care spending over three years, including millions more for cancer care, mental health and addictions, seniors’ care

While the economic forecast for this year is grim with a slim .8 per cent increase in real GDP, the finance minister anticipates 2.3 per cent growth next year and pointed to lower than expected corporate and natural resources revenue, as having an impact.

Katrine Conroy’s fiscal plan outlines a deficit of $7.9 billion for the 2024-25 fiscal year, with a $7.7 billion deficit the following year, and a $6.8 billion deficit budget for 2026-27, with the goal of a balanced budget.

“We are on solid financial ground,” she insisted, pointing to B.C.’s debt-to-GDP ratio being better than most other provinces and the national average.

Taxpayer-supported debt is projected to be $71.9 billion by the end of the 2024 fiscal year, according to the ministry of finance, approximately $3.8 billion less than forecast in last year’s budget.

Over the three-year plan, service delivery agency spending will grow by $5 billion, to $56.2 billion in 2026-27: $512 million in school district spending due to increasing enrollment, $845 million for post-secondary institutions seeing “higher staffing requirements for a growing student base” and $1.1 billion in transportation, social services, and housing sectors.

20 per cent ‘flipping tax’ on homes introduced

Premier David Eby has been clear that speculators are in his crosshairs, and with the 2024 budget his government has announced details of a new "BC Home Flipping Tax."

Starting Jan. 1, any profits made from the sale of a residential home within two years of buying it will be subject to the tax – with exceptions.

Premier David Eby has been clear that speculators are in his crosshairs, and with the 2024 budget his government has announced details of a new "BC Home Flipping Tax."

Starting Jan. 1, any profits made from the sale of a residential home within two years of buying it will be subject to the tax – with exceptions.

The legislation government intends to pass during the spring session would see a sliding scale: 20 per cent on profits made on a home sold within the first year, gradually declining to 10 per cent if sold after 18 months, and further reducing to zero after two years of ownership.

The Ministry of Finance estimates the tax could generate about $43 million a year in tax revenue.

B.C. budget confirms billions in housing investments, offers rosy real estate outlook

The provincial budget has formalized billions of dollars in promises made by the BC NDP in recent weeks for programs like BC Builds, and it also provides an in-depth analysis of where housing market is and where the government believes it’s going.

Building permits were down last year and unsold inventory of new homes grew in the Vancouver, Victoria and Abbotsford areas compared to 2022.

Interest rates were blamed for slumping sales last year in B.C.’s largest housing markets, and the population continued to grow due to international immigration, while inter-provincial migration saw loss to other provinces for the fifth consecutive quarter (largely to Alberta).

Financing challenges, skilled-labour shortages, and ever-rising construction costs impacted the market and the number of new homes that were finished and ready for occupancy decline in the Vancouver and Kelowna areas, while Victoria and Abbotsford saw increases.

Despite that, “the ministry expects home sales activity to rebound in 2024 from slow activity in 2023” with prices expected to rise an average of 2.3 per cent this year and 2.9 per cent in 2025.

With Files From Penny Daflos CTV News Vancouver