B.C. posts $1.68 billion surplus, up from $184 million forecast in Feb. 2014

VICTORIA – British Columbia’s finance minister says a higher-than-expected budget surplus leaves room for modest family initiatives but he’s wary of escalating forest-fire costs and signs of economic downturns in Canada and internationally.

The province’s budget surplus hit $1.68 billion, significantly higher than the original forecast of $184 million, Mike de Jong said Wednesday.

He announced the $1.5-billion surplus increase for the 2014-2015 budget as he released the government’s public accounts numbers for the fiscal year that ended in March.

“We are firmly back in the black,” de Jong said. “What does that mean? What does it mean for families? What does it mean for the province? It has meant in a limited, modest way that we are able to begin to provide some additional supports to families.”

He said recent government programs involving early childhood development tax credits and education and skills-training grants are related to the increased surplus.

New Democrat finance critic Carole James said much of the surplus has resulted from taxes and fees.

“It’s come from hard-working British Columbians who aren’t getting anything back from this government,” she said, citing higher rates for hydro, medical services premiums and public auto insurance.

De Jong said the larger surplus is due to $1.3 billion more in revenues than were estimated in the February 2014 budget.

The final numbers break down the revenues:

— Taxes, $899 million

— Crown corporations, $486 million

— Fees and licences, $89 million

— Investment earnings, $112 million

“We are better positioned than virtually any other jurisdiction in the country,” De Jong said about B.C.’s budget. “No one else is looking at these numbers.”

The province’s economy grew 2.6 per cent in the past year, which is slightly better than the national average of 2.4 per cent, he said.

Total debt has increased to $63 billion, but debt-servicing costs are dropping and saving “hundreds of millions of dollars a year,” de Jong said. B.C.’s debt-ratio costs are 17.5 per cent, with only Newfoundland and Labrador, Saskatchewan and Alberta lower, while Quebec and Ontario are at 49 per cent.

“But it appears there may be economic storm clouds gathering again,” de Jong said.

He said concerns that Canada may have slipped into a recession and economic turmoil in Europe and China will impact B.C.

De Jong said the province is currently on track to balance its budget again this year, but the trend will become clearer in September when the government provides a quarterly fiscal update.

Salaries for the government’s senior public employees have dropped, he said.

Total pay for senior executives in 2014-2015 was $66 million, averaging at $225,325, which de Jong said is a 6.2-per-cent drop from the previous year.