B.C. deficit forecast tops $3 billion

Falling revenues have pushed B.C.'s deficit forecast above $3 billion, due to

Finance Minister Kevin Falcon

VICTORIA – Expected revenues to the B.C. government fell by $303 million in the second quarter of the fiscal year, due mainly to instability around the world, Finance Minister Kevin Falcon announced Monday.

The drop in revenues will make it more difficult to meet the government’s target of balancing the budget by 2013. Falcon said he will wait until January, when the finance ministry has to finalize its next budget, to see if that target can still be met.

Coupled with a $30 million jump in spending, the latest figures bring the deficit forecast for the year fiscal year ending next March to $3.1 billion.

In a quarterly briefing to reporters, Falcon also confirmed that it will take until the spring of 2012 to reverse the harmonized sales tax.

The largest revenue dip is $146 million less in net income from commercial Crown corporations. The largest factor there was a drop in Insurance Corp. of B.C. revenues, where investment income fell because of instability in the European Union. Falcon said insurance companies around the world have seen investments “hammered” by the the struggles to keep Greece, Italy and other countries from defaulting on debt.

Low prices from a glut of natural gas supplies have reduced B.C. revenues, and the continued slump in U.S. housing has affected forestry revenues.

On the spending side, Falcon said the B.C. government has trimmed operating expenses by $20 million this year. But that was offset by $30 million in costs related to flooding that mainly hit northern B.C. this spring.

Just Posted

VIDEO: Surrey gallery welcomes big, colourful Indian art on tour

Large-scale paintings and drawings at Bear Creek Park facility starting Saturday, Jan. 20

Unstable soil means more studies, drawings needed for Cloverdale Arena

The added geotechnical work and designs won’t put a delay on proceedings, City says

‘Still room to grow’ for Semiahmoo team

Totems ace Surrey Fire Fighters Senior Girls Goodwill Basketball Tournament title with 76-62 win over Tweedsmuir Panthers Saturday in Cloverdale

Union files human rights complaint over Chilliwack school trustee’s LGBTQ comments

Board and trustee Barry Neufled facing $50,000 tribunal charge over alleged ‘unsafe work environment’

Simulated whale rescue on White Rock beach

Training endeavour aimed to ready crews for future strandings

More than 2,000 people left without power in Surrey after truck hits power pole

BC Hydro works to restore power after crash at Fraser Highway and 184th Street

Pipeline routing through Chilliwack subject of NEB hearing Monday

City of Chilliwack, WaterWealth Project and local Sto:lo intervenors in the hearing

Senior randomly stabbed in B.C. mall food court

Woman arrested after victim, 71, suffers serious injuries

Stealth work OT, come through with first win

Joel McCready nets winner, Eric Penney makes 52 saves as Vancouver knocks off Buffalo

VIDEO: Southern schemes on stage in Langley

The farce of “The Foreigner”

B.C. Liberal hopefuls begin final leadership push

Five MLAs, one outsider pitch policies to party members

Vancouver Island marijuana producer bought by Aphria in $230M deal

Aphria’s annual production forecast increases to 230,000 kgs

UPDATED: ‘Young, innocent’ teen hit during Vancouver shootout dies

15-year-old Coquitlam boy was in a car driving by the scene

Fraser Valley truck driver killed in Alberta semi truck crash

Young driver was adjusting load on side of highway to Fort McMurray

Most Read