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

VIDEO: Wildfire erupts north of Sicamous above Shuswap Lake

Observers suspect fireworks sparked blaze, Wildfire BC states cause still unknown

Rapattack crew responds to small wildfire east of Salmon Arm, Sicamous

Three-person rappel crew dispatched to Joss Mountain

EDITORIAL: Improving highway safety

Highway 97 has seen plenty of collisions and accidents over the years

Thompson Okanagan Tourist Association: How accessible is your business?

TOTA launches video to encourage proprietors to remove barriers

VIDEO: Otter pups learn to swim at B.C. wildlife rescue facility

Watch Critter Care’s Nathan Wagstaffe help seven young otters go for their first dip

Canadians can travel to Hawaii in September; no quarantine with negative COVID test

Travellers will be required to pay for their own tests prior to arriving

Kelowna house and hip hop artist grows in popularity with new single

Edge’s ‘Vice City Vibes’ is available on all streaming platforms now

Alberta to require masks at schools this fall, but still no mandate in B.C.

B.C. students are also set to return to classrooms in September

Anonymous letters tell Vancouver Island family their kids are too loud

Letter said the noise of kids playing in Parksville backyard is ‘unbearable’

Police watchdog investigates Kamloops RCMP after stabbing death

The IIO is investigating the police’s lack of success in locating the man charged in stabbing

Forty-three properties near Dry Lake, along Highway 5A, under evacuation alert

Wildfire has been burning out of control north of Princeton for two days

Wildfire near Merritt creates smoke for drivers on Coquihalla

Coldwater River fire was estimated at seven hectares Aug. 3 and classified as out of control

Most Read