Province
Législature
Session
Type de discours
Date du discours
Locuteur
Fonction du locuteur
Parti politique
Colombie-Britannique
38e
5e
Discours du budget
17 février 2009
Colin Hansen
Minister of Finance
British Columbia Liberal Party

Today I present Budget 2009, a budget that is all about stability and confidence. It builds on the strengths we have as a province to cushion the effects of the global economic crisis, recognizing how it is affecting all British Columbians.

All across this province, from the northwest to the Kootenays, from the Peace River region to Vancouver Island, people are concerned about what this crisis means. They're worried about paying their bills. They're worried about their retirement savings. They're worried about their children and the future of their families.

It all comes down to one word: confidence. Whether you're a young person just starting out, a parent saving for your children's education or an older person living on a pension, you want to feel confident that the income you rely on and the services that you need will be there for you.

You want to feel confident so that you can move forward, and that's what this new budget is all about. It sets out a path not just for the year ahead but for many years to come, to make sure British Columbia's future is even brighter than its past.

As the Premier announced two weeks ago, the budget includes a temporary deficit. Weighed against the risks to our economy, our communities and our future, it is quite simply the right thing to do. But I want to be clear that this is not the same kind of deficit that we saw seven years ago.

That was a long-term structural deficit, the kind that persists year after year even in times of strong economic growth. What we have for the next two years is a short-term deficit, one that results from a downturn in projected revenues, because in spite of our strengths as a province, we are not immune to the impacts of the world economic slowdown.

Since the fall we have seen almost every major economic indicator turn downward. Projected revenues have plummeted. Compared to what we were forecasting as recently as last September, we have seen more than $6 billion in expected revenue over three years simply vanish. Retail sales, housing starts and consumer confidence have all been affected, and economic growth has slowed to the point where we are now expecting the economy to shrink in 2009.

All indications are that we will see a recovery beginning in 2010. That's good news, but in fact, it's not much comfort to the people who are feeling the effects of the global recession right now. The people of this province are and always will be our greatest strength, so we need to make sure that they are taken care of as we move through a challenging economic period.

That is why we are taking immediate, decisive action with this budget to support and protect British Columbians and maintain their confidence, to make targeted investments that stimulate our economy and to move forward with long-term initiatives so we can make the most of the coming recovery and set the stage for a future of renewed growth, new prosperity and new opportunity.

Four months ago, when the breadth of the global economic slowdown first became apparent, the Premier announced a ten-point plan to help alleviate the impacts on families, communities and businesses. We accelerated a planned cut to personal income tax and made that 5 percent reduction retroactive to January of 2008.

This one move put more than $130 million back into the pockets of British Columbians each year. It also means that British Columbia now has the lowest personal income taxes of any province in Canada for individuals earning up to $116,000 a year.

The Premier's ten-point plan included steps to protect consumers as well. British Columbians now have unlimited deposit insurance protection in credit unions. RRSPs are protected from seizure by creditors, and work is underway to give every British Columbian the option of enrolling in a new registered pension plan.

The small business income tax was also reduced, effective last December 1, to 2.5 percent. This will save small businesses more than $120 million over three years. Another $60 million over three years will flow to businesses collecting the provincial sales and hotel tax on the province's behalf.

The industrial employers who are working hard to maintain jobs will benefit from a new property tax credit, saving them more than $115 million over three years. In total, the measures announced by the Premier provide more than $425 million in tax relief to support B.C. families, businesses and individuals over three years.

Today, as part of our revenue-neutral carbon tax plan, we are announcing more relief for industry. We will increase the industrial property tax credit from 50 percent to 60 percent starting in 2011. This will save sawmills, pulp mills, mines and other industrial employers an additional $11 million a year.

With this budget, we are also taking steps to soften the blow of the economic slowdown. First, as the Premier announced two weeks ago, we are investing more than $14 billion in infrastructure projects that will take place in every region of the province, and $2 billion of this is cost-shared with the federal government for new projects that will be accelerated over the next three years.

Another $10.6 billion is for approved projects within the province's capital plan for the next three years, and $1.4 billion in local infrastructure projects are being built in partnership with local governments and the federal government.

These new and accelerated investments will generate as many as 88,000 jobs across B.C. and will build the assets we need to support future growth and development.

Of that $14 billion, there is $1.3 billion earmarked for schools, including renovations, new construction and seismic upgrades. There is $1.7 billion that will be invested over three years for projects in the post-secondary sector, $2.5 billion for health care facilities and $2.3 billion for transportation projects.

The benefits will start taking shape right away, and they will be in every region of the province. These projects will help thousands of British Columbians get through the global economic slowdown. They will help employers and workers and families and communities maintain a sense of stability, security and confidence, because every job counts.

This is a budget that is not just about creating jobs; it's also about building our future. We are still better off and better positioned to get through this crisis than just about any other jurisdiction on the continent. We have a strong record of prudent fiscal management and one of the most competitive tax regimes in North America. We have the strongest, most diversified economy in our history.

We've reached out across the Pacific. We've built new trade and investment relationships. We've paid down the province's operating debt by more than 50 percent from its peak, and because we've managed responsibly, B.C. has earned a triple-A credit rating, tied with Alberta for the best among Canadian provinces. These are all assets that we can leverage for the future, and we are doing exactly that.

We're protecting the services that British Columbians need and rely on every day. That includes making new investments in health care and education, as we have done every year since 2001. Funding for the Ministry of Health Services will increase by $4.8 billion over three years. That is approximately 90 percent of all new spending in our three-year plan.

It includes $13 million to establish a new B.C. family residence program. This program will provide additional assistance for those British Columbians and their families who have to leave their home communities to get the care they need.

By 2011 total provincial spending on health will be $17.5 billion, an increase of 66 percent since 2001; $40 million will be used to expand health education to meet the demand for nurses and other health professionals, and $23 million will fulfil the province's funding commitment to train more physicians.

Post-secondary institutions will receive an additional $228 million over three years, with $165 million targeted to make higher education more accessible. In the K-to-12 education system per-pupil funding will increase to $8,242, the highest ever in the province's history. As was noted at both the recent B.C. economic summits, education is more important than ever in an economic downturn, so these are critical investments to our future.

So are investments in community safety. With this budget, we are supporting the comprehensive plan that the Premier announced last week to combat gang and gun violence with more police, more prosecutors, more jails and more secure courts.

Budget 2009 also enhances our support for those in need, investing nearly $300 million over three years in vital social services. That includes $110 million in new funding for income assistance, $73 million in additional funding for programs and services for adults with developmental disabilities and their families, $43 million in additional funding for families and for children in care, $38 million in new funding for children with special needs and $25 million more for child care subsidies.

Beginning in 2011 we will also increase the low-income climate action tax credit by 10 percent, and this new benefit will put another $15 million a year back in the pockets of families and individuals who need it the most. That is in addition to the $146 million a year that is provided by that credit now.

Going forward, we will provide more tax relief for homeowners too. As the Premier announced in November, we have created a temporary two-year property tax deferment program. It allows people hard hit by the economic downturn to defer their property tax payment for each of the next two years. That will help in the short term.

However, we recognize the need for more assistance in northern and rural areas. People there are feeling the impacts of the downturn in our economic sectors, and we want to provide them with a sense of stability. Today we are announcing a new northern and rural homeowner benefit funded by the revenue-neutral carbon tax. With this benefit, starting in 2011 when the temporary tax deferment program expires, northern and rural homeowners will see an increase in their homeowner grant of $200 per year.

These are targeted expenditures, and they will help ensure that the current economic crisis does not have a disproportionate impact on those least able to withstand it. Families struggling to make ends meet, people with disabilities, children with special needs — they are our priority, and we have worked hard to ensure that there is room in the budget to support them.

This year, with commodity prices and the forest sector down to their lowest levels since the 1970s and revenues off dramatically from what we were expecting before the global meltdown, we faced a real challenge in protecting vital programs in health care, education and social services. Just as many families and businesses are doing, we looked for ways to cut discretionary spending, because as a government we have an obligation to make the best possible use of the taxpayers' hard-earned dollars.

Back in October the Premier directed every ministry to closely review all operations and all aspects of their operations and identify areas where costs could be reduced without undermining important public services. As a result of that review, we are moving now to dramatically reduce all types of discretionary spending across the public sector. This includes, for example, a 76 percent reduction in the budget for advertising and publications, a 22 percent reduction in travel expenses and a 23 percent reduction in the cost of contracted professional services.

We are also reducing by 20 percent the number of senior executives in government, and in total, all of these efficiencies result in savings of $1.9 billion over three years, all of which is being reinvested in public services. We will conduct a further review of programs over the next two years to find additional efficiencies as part of our commitment to return to a balanced budget by 2011.

Spending will be held in check in each of the next two years, and as the economy picks up steam, revenues will recover. To help ensure that that happens, Budget 2009 includes a series of targeted investments starting with action to address our labour market needs.

As I have travelled across B.C. over the past few months, employers have told me that the shortages of skilled workers are still among their biggest concerns. So we are moving forward with a labour market strategy to meet both our short-term and long-term needs. In the coming year the Industry Training Authority will provide an additional 2,000 apprenticeship training spaces, and we will invest more to break down barriers for new Canadians so they can participate fully in our workforce.

Immigrants have always been vital to our labour force, and proven programs like the Skills Connect program help ensure that they can put their skills, experience and training to use. With this budget, we are providing $16 million over three years to support these programs.

We are also making targeted investments in key economic areas to maintain stability and confidence for B.C. families. Mining and mineral exploration is a sector with enormous potential. It provides good jobs and offers a range of new opportunities, especially in our rural areas.

Just a few weeks ago our geological survey branch discovered significant gold, silver and copper deposits in parts of the Interior that had not been explored before. When commodity prices recover, mining and mineral exploration will make an even greater economic contribution. We're moving now to enhance the environment for growth in this important sector.

Budget 2009 extends for another year the B.C. mining flow-through tax credit, which provides a non-refundable tax credit to individuals, encouraging them to invest in B.C. mining and mineral companies. Combined with the corresponding federal tax credits, this incentive reduces the cost of a $1,000 investment by more than $600. It has already made a big difference for the industry. Since the credit was introduced, investment in mining exploration in B.C. has increased by an astounding 1,200 percent.

The energy sector is another leading light in our increasingly diversified economy. In 2008, sales of oil and gas rights reached a record high of over $2.6 billion, with thousands of people employed in that sector. We have new independent power projects currently in progress all over British Columbia, which today employ over 1,100 workers.

Recognizing that when the North American economy recovers, energy demand is likely to climb again, Budget 2009 invests $110 million over three years to encourage further growth and development in the energy sector. This includes $6 million for strategic development of the shale and tight gas resources in the northeast.

It includes $10 million for the northwest hydro transmission line along Highway 37. This is a $400 million project in partnership with the private sector that could stimulate thousands of jobs and billions of dollars' worth of economic activity. It also includes $94 million for the oil and gas rural road improvement program.

As the Premier announced in October, we are also accelerating spending on resource road maintenance. We have committed $5 million in the fiscal year just ending and a further $15 million for the year ahead. This will help ensure that companies have access to timber and other resources.

In forestry the government is moving ahead with a series of initiatives announced last month to encourage industry growth and diversification, to further support our forest workers and to expand the use of B.C. wood in construction.

We've lowered coastal stumpage rate by more than 70 percent to reflect current market realities. We also continue to offer assistance through the community development trust, which was established in 2008 to support forest workers, their families and their communities. We will work to maintain the program's success and to extend its benefits to workers in other resource industries.

With this budget we are also providing new support for the agriculture sector. Farmers are a critical part of not just our economy but also our way of life in B.C. They have been buffeted by changes in the world global economy for quite some time. Recognizing the pressures they are under, government is moving to reduce their taxes.

Budget 2009 introduces a school property tax reduction of 50 percent for all farmland starting in the 2011 tax year. We are also committing up to $177 million by 2012 to continue the Growing Forward agreements on agriculture, which is cost-shared with the federal government. It provides support through a variety of programs, including crop insurance and farm income stabilization, to help make life a bit easier for those we rely on to feed our families.

We are also committing to working with the B.C. agriculture sector on the future application of provincial sales tax, with a goal of continuing to streamline, simplify and improve the efficiency of the tax code.

Agriculture, forestry, energy, mining — these are all important parts of the B.C. economy, providing jobs that support and sustain countless families and communities.

In recent years as we have worked to diversify our economy, we have also seen a major rise in the film and television sector. This sector now provides an estimated 35,000 jobs and generates production spending of approximately a billion dollars every year. To help keep that momentum going, Budget 2009 removes the expiry dates for film tax credits, which have played a key role in that industry's growth. This move will offer greater certainty for companies and reinforce the message that B.C. is open for business.

We are also extending eligibility for domestic film tax credits to include Canadian-controlled companies rather than restricting it to B.C.-controlled firms. This will make it easier for companies here to access other markets and to raise capital from outside the province.

TV and film are just one part of the vibrant arts and culture community that thrives in every part of this province, from the smallest towns to the biggest cities. It delivers benefits that we can count, like jobs, but its value to our province is even greater. Our artists, our performers and the people who support them — the volunteers, the sponsors, the suppliers, the umbrella groups — help to shape our vision of who we are. They bring to life the concept of culture, and just as important, they bring us together, entertain us, intrigue us and challenge us intellectually.

With this budget we are injecting $15 million in strategic one-time grants to support arts and culture and for the conservation of the province's historic places. We are also continuing our work with the sector to encourage partnerships and programs that enhance the contribution of arts and culture to our communities. That includes supporting the Cultural Olympiad, which right now, this week, is showcasing some of the best performers and artists in our province as part of the countdown to the 2010 Olympic and Paralympic Winter Games.

Together these initiatives in mining, energy, agriculture, forestry, and arts and culture will translate into jobs and economic activity, as will the dollars we are investing in infrastructure. These investments will help to get our province through the year ahead, when it appears we will see the worst of the economic downturn.

For 2009 we are forecasting economic growth of minus 0.9 percent, climbing back to 2.4 percent in 2010 and 2.6 percent in each of the following years. These are, as always, prudent estimates which are lower than those put forward by the Economic Forecast Council.

Revenues, which fell dramatically in recent months, are forecast to recover somewhat in the year ahead to $38.8 billion, and we are expecting, by the end of the coming fiscal year, to see a deficit of $495 million. In 2010-2011 we are forecasting that this deficit will drop to $240 million, and we will return to a balanced budget by 2012.

To make sure that we meet that goal, we intend to hold the line on public sector wages. We will respect existing agreements, and we will take steps to mitigate the impacts of spending cuts on public sector workers. But in the current economic climate we do not have the additional room in the budget to increase wages.

We're going to borrow more to finance infrastructure spending and to foster future growth and to keep British Columbians working through the downturn. Over the next three years our taxpayer-supported debt-to-GDP ratio will climb to 15.8 percent, and that is still among the lowest in the country. It is also 26 percent lower than the debt burden B.C. faced in 2002, when we also had a deficit but one which was a magnitude of more than $4 billion.

Mr. Speaker, we eliminated that deficit in just three years, and today we are once again determined to get this province back in the black. Economic projections change over time, but even as the economic downturn has worsened in the past few months, leading economists continue to forecast an upturn in B.C.'s growth in 2010. With this budget, we are moving now to ensure that when we do see that upswing, we are prepared to take full advantage of four key opportunities to set our province on an even stronger course for the future.

First, we will continue to invest in our potential to be a leader in the new green economy. As the global financial situation improves, there will be renewed demand for clean energy, new technologies and new ideas. Budget 2008 invested more than $1 billion in a wide range of climate action initiatives, including the B.C. bioenergy strategy, which not only paves the way for a greener future but also provides new opportunities for rural and resource-based communities.

Budget 2009 builds on those investments and the climate action agenda. It will provide $75 million to extend for another three years the innovative clean energy fund. It provides $15 million over four years to completely offset the cost of the carbon tax for local governments that commit to becoming carbon-neutral by 2012.

There is $11 million over four years for Trees for Tomorrow, our program to plant four million trees in school yards, hospital grounds, civic parks and other public places, and there is $7.5 million over four years to complete B.C.'s portion of the hydrogen highway, a continuous network of fuelling stations all the way from B.C. to southern California.

We are also introducing a motor fuel tax exemption for hydrogen, putting it on the same footing as other alternative fuels and extending to 2011 the PST exemptions on energy-efficient windows, doors and heating systems, and on technologies that make commercial trucks more fuel efficient.

We will continue to create an environment where greener choices and cleaner technologies make good economic sense and help to build the low carbon economy of the future.

The second initiative that we're moving forward on is with our Asia-Pacific gateway strategy. Asian economies are, of course, feeling the impact of the worldwide slowdown, but they, too, are expected to rebound in 2010. We have a huge geographic advantage in not only being a reliable supplier but also being the facilitator of commerce between North America and the Asia-Pacific economies.

We have opened trade and investment offices in Shanghai, Tokyo and Seoul, and just last week in Beijing and in Guangzhou. We will continue to upgrade our ports, enhance our transportation networks, build new relationships and win new markets to make B.C. an unmatched destination of choice for business, culture, tourism, work, education and opportunity.

Third, we will build on our efforts to establish our province as one of the best locations in the world from which to conduct international business. We've been working hard to attract foreign banks, life sciences companies and other international businesses that generate highly skilled, high-paying jobs, and we see huge untapped potential there.

We have a lot to offer these firms. Let me just give you one real-life example. Just recently, February 6, one of Hong Kong's biggest investment banks opened a new international head office in Vancouver. They had planned to locate that new office in New York City, but they came here instead because of our people. To quote the company's managing director of international business: "Vancouver has such a depth of English-Mandarin speakers who have degrees in finance and accounting designation, which is really what we need."

That's the message we're sending to businesses around the world: B.C. has exactly what you need to successfully conduct international business. We have the people, the diversity, the skills, the relationships, the quality of life, the access to markets, the tax advantages — everything you need. We are going to work even harder to get that message out.

In the year ahead we will also review the international financial activity program, which provides incentives to international businesses to make our province even more attractive to investors.

Finally, with this budget we are acting to ensure we make the most of all the opportunities that will be flowing as a result of us hosting the world in 2010. Over the next year VANOC will be investing more than $3 million a day in our economy. Those dollars are mostly from ticket sales, broadcast rights and sponsorship agreements.

Local companies are also being boosted by our winter games preparation. For example, construction of the bobsled and luge runs at Whistler created 680 jobs, and that is only one of a long list of projects that are now underway or recently completed as part of the province's Olympic legacy.

The total economic impact, once the games are done, has been projected by independent sources to be as much as $10 billion. Those dollars translate into jobs and opportunity not just today or in 2010 but for many years to come. We are going to show the world that British Columbia is indeed the best place on earth.

Some 10,000 journalists will come here to support and report on and showcase British Columbia. Through our B.C. stories program they will share iconic images of this great province with three billion television viewers from around the world.

Some 250,000 visitors will take home stories and photos and memories, making this quite literally a once-in-a-lifetime opportunity to demonstrate what we have to offer for families, for businesses, for industry, for entrepreneurs and of course for visitors. Dollar for dollar, the Olympic Games may be the best investment we will ever make in our province, in our people and for future generations.

There is no question that the last five months have been difficult, and the coming months will be just as challenging. But I have every confidence that B.C. is well positioned not only for recovery but for a whole new stage of growth. Some may say that it's too optimistic, but history indicates otherwise. B.C. has been through tough times before, and each time we've risen to the challenge, and each time we've emerged stronger.

Look at what happened in the 1990s. While the rest of North America was enjoying economic growth, our province was in a downhill spiral. By the end of that decade growth had declined, and the deficit had soared. Consumer and business confidence had plummeted. Investment in our province had all but dried up, and people were leaving B.C. by the thousands.

In 2002, when this government tabled its first full budget, we were facing a structural deficit of over $4 billion, the consequence of year after year of government spending outpacing revenues. That's what we were up against in 2002, and critics said we would never get back to a balanced budget in just one term. But we had a plan. We knew exactly what we had to do, and by 2005 we had moved from deficit to surplus budgets.

There were some who criticized us. Some people said we should spend more, but we continued with our prudent approach. Instead of committing to new spending, we used surpluses to pay down the operating debt and to make key investments in key priority areas.

For example, since 2005 our province has invested $100 million in a first nations new relationship trust, $250 million in a housing endowment fund and more than $500 million in additional supports for children. We also made the single-largest one-year debt payment in B.C.'s history — $1.9 billion — in 2005.

We've been prudent. We've managed responsibly. We've worked with British Columbians to build a strong, vibrant economy, to provide support for families and communities and to create an environment where businesses and investment can thrive. Now, thanks to all that effort, we are in a good position. We can leverage our advantages to re-energize our economy, to support families and communities and to make sure that help is there for those who need it most.

We can make immediate and dramatic investments in our infrastructure that would help keep people working and position ourselves for future growth. We will have new schools, expanded health facilities, more social housing, better roads and bridges, more skilled workers and more opportunities than ever before.

We will continue to have one of the most competitive tax rates in North America, along with a more diversified economy and a quality of life that is second to none.
We will return to surplus budgets, pay down our debt and continue to build our sound economic and fiscal footing.

After the 2010 Olympic and Paralympic Winter Games we will be a destination for thousands of people from all around the globe who, until 2010, might not have known what British Columbia had to offer. They are going to come here to work, to visit, to invest and to build new partnerships, because they are going to see what I saw at the economic summits the province organized earlier this month.

When I walked into rooms full of people concerned about our economy, there were business people, educators, parents, volunteers, people who run not-for-profit agencies. Given the state of the world economy, I would have not been the least bit surprised if the mood in the room had been dark.

It wasn't. In fact, it was the exact opposite. In both Prince George and Vancouver the mood of the summit was "let's get to work." People were keen to share, to learn about emerging opportunities. They had a sense of confidence about B.C.'s future, and they were ready to roll up their sleeves and do what it takes to build our economy.

That, Mr. Speaker, is what this province is really all about. It's a place where people face their challenges head-on, where they work hard and where they know that together we can build a future of boundless opportunity. Our people have the talent, the resources and the strength. They have the ingenuity, the drive and the courage. As we move forward, they have confidence — confidence that we can get through the tough times; confidence that those in need of assistance will get it; and confidence that B.C. is on the right track, building a future that will make our children and grandchildren proud.