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B.C. budget to focus on COVID-19 support while tabling massive deficit

The B.C. government will outline its first pandemic budget on Tuesday, as it attempts to strike a balance between measures to combat COVID-19 and future economic growth.

Finance Minister Selina Robinson, who replaced long-time finance minister Carole James after James did not run again in last fall’s election, will read her first budget speech around 2 p.m. PT in Victoria.

The budget is also the first since the election, and will detail how the province will attempt to fulfill some of its campaign promises.

“What we are going to see is a budget that puts people at the centre. It will see us continue to support people, businesses and communities,” Robinson said.

“And (it) moves us into the next phase as we focus on recovery.”

Click to play video: Province announces new grant for struggling businesses

Unlike budgets in the past, this one will be supplemented by multiple financial programs the government has been putting into place on the fly during the pandemic.

The NDP is expected to provide additional funding to the small- and medium-sized business grant programs. The currently $340-million program has amended eligibility criteria multiple times and is supplementing businesses that have been impacted by the province’s recent circuit-breaker restrictions.

But there is no short-term reprieve for businesses. Monday’s extension of restrictions to May 25 and new travel restrictions coming into effect on Friday will have an impact on the hospitality and tourism sectors, which continue to be battered by the COVID waves.

“These measures are designed not to put more stress on the already stressed tourism sector,” Premier John Horgan said.

“Quite the contrary. We’re working in collaboration with the tourism sector to make sure they can have a positive summer and a fall and a winter that will try to make up some of the fallback that they’ve seen as a result of COVID-19.”

The province is expected to run a massive deficit because of the pandemic.

The last budget, tabled in February 2020, included a surplus of $227 million for 2020-21.

Last December, the province said the 2020-21 surplus had become a deficit that had climbed to $13.6 billion following COVID-19 spending and downturn.

Read more:
Federal budget delivers big promises on childcare, tamer housing measures

A federal commitment to create a Canada-wide early learning and child-care plan has taken some financial pressure off.

Ottawa is proposing up to $30 billion in spending over the next five years to create a nationwide child-care system that it promises will bring fees down to an average of $10 per day in regulated centres by 2025-26.

“Throughout the pandemic, we have been working very closely with the federal government to ensure our programs are aligned with the federal government to make sure we are doing the most for British Columbians (and) certainly you will see that coming,” Robinson said.

“We have been working really hard to develop a program here and seeing the federal government come through is really good. I look forward to the details and making sure we can build on that.”

Click to play video: Biggest takeaways from the 2021 federal budget including $10/day daycare

Iglika Ivanova from the Canadian Centre for Policy Alternatives describes this as the most important budget of a generation.

The economist said B.C. has an opportunity to invest in “the care economy” and support those impacted most by the pandemic.

Data shows women and young people have been disproportionately impacted, she said.

“The good news is that there is near-universal agreement that active public-sector investment is critical to economic growth at this stage of the pandemic, and that the risks of spending too little far outweigh the risks of spending too much,” Ivanova said.

“The fiscal challenge now facing the provincial government is to ensure that new spending helps tackle systemic inequalities and promotes economic activity in the public interest.”

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