Finance Minister Carole James presents her latest budget on Feb. 18, 2020, projecting a surplus of $203 million for the 2020-21 fiscal year. (Tom Fletcher/Black Press)

B.C. budget heads into unknown deficit range preparing for COVID-19

Surpluses washed away by $5 billion spending, plummeting revenue

The B.C. government has effectively scrapped its 2020 budget and plunged into multi-billion-dollar deficits to deal with ramped-up health care and other spending from the COVID-19 pandemic, while tax revenue falls off just as quickly.

A brief emergency session of the B.C. legislature has provided more than $50 billion in spending authority to the NDP government, whose authority was due to run out March 31. It is now extended to the fall, including a $5 billion contingency fund to cover cash payments to individuals, tax relief for businesses and an expected surge in health care and social services costs as thousands of people lose their jobs and many fall ill with the novel coronavirus.

The $5 billion fund includes deferred provincial sales tax, employer health tax and other payments due from businesses, as many have cut back or closed entirely due to COVID-19 infection controls.

With the projected $203 million surplus and string of balanced budgets already a distant memory, one of the first opposition questions for Finance Minister Carole James was, will $5 billion be enough?

“I think it is sufficient for now,” James replied, adding that it is just a first step as economic impact is still unfolding. “So I cannot commit to whether this would be sufficient for the next three months, the next six months, the next two months, depending on what kind of situation we’re facing.”

James and Premier John Horgan have been holding back details and applications as the federal government assistance evolves. Prime Minister Justin Trudeau announced a revised “emergency response benefit” March 25 that he says will provide $2,000 per month for up to four months, with applications available April 6.

The new federal benefit is a temporary bridge to Employment Insurance for the more than one million people who have applied for EI in recent weeks due to COVID-19 effects on business, child care and medical isolation rules.

B.C.’s promised $1,000-per-month package is similar, but James says it won’t be available until early May.

RELATED: $1,000 B.C. payment for affected workers out by May

RELATED: Trudeau announces $2,000-a-month bridge to EI

James stressed that B.C.’s “tax-free emergency payment” will not be income-tested, and will be available to people who are eligible for EI under Ottawa’s expanded eligibility rules for the emergency.

B.C. Liberal MLA Jas Johal urged help for businesses to keep people on their payrolls, citing British, Danish and New Zealand programs that backstop most or all of their salary demands. Johal noted that the Canadian Federation of Independent Business has advised: “A wage-subsidy program is our best protection against large-scale unemployment.”

B.C. Green MLA Adam Olsen questioned James about the large portion of the government package that defers business taxes.

“I think the tax deferrals help much larger businesses more than they assist small business,” Olsen said.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislatureCoronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

COLUMN: The other graph that shows B.C. can beat COVID-19

Is the curve being flattened? data on hospitalizations provides a crucial answer.

Goose in Abbotsford rescued after legs wrapped up in fishing line

Wildlife centre operator says people need to be more careful

Mission students begin home schooling on Monday

Superintenden Angus Wilson said teachers will be providing learning opportunities to students

Abbotsford Police use gold-wrapped BMW for latest anti-gang campaign

Program aims to pass on message that ‘All That Glitters is Not Gold’

Semi crash on Highway 1 in Abbotsford sends two to hospital

Crash left both drivers unconscious and trapped in vehicles

VIDEO: How doctors in Canada will decide who lives and dies if pandemic worsens

Officials in several provinces have been developing guides so that doctors don’t feel alone

Two people fined after B.C. police spot online ads re-selling 5,000 surgical, N95 masks

Police confiscated the masks, being sold at inflated prices, and now working with Fraser Health

Sex workers face new risks during COVID-19 pandemic

‘Desperation has kicked in’ for vulnerable, undocumented workers unable to access help

Unclear if Cowichan couple refusing to self-isolate will face penalty

No fines or charges have been laid to date, including Cowichan couple who won’t self isolate

COVID-19: Postponed surgeries will be done, B.C. health minister says

Contract with private surgical clinic to help clear backlog

Black Press Media ad sparks discussion about value of community newspapers

White Rock resident hopes front-page note shines light on revenue loss during COVID-19 crisis

Vancouver man, 21, charged after mother found dead in Squamish home

Ryan Grantham, 21, has been charged with second-degree murder

Most Read