The British Columbia government says it's now projecting an $11.2 billion deficit this fiscal year, still a record but down from a projected $11.6 billion in its last quarterly report.
The Ministry of Finance revealed in its second quarterly report released Thursday that the province is projecting revenues to be $512 million more than previously forecast due to higher corporate and personal income taxes.
Finance Minister Brenda Bailey said the province's debt is projected to be $117.7 billion, which she said is "manageable" and B.C.'s net liabilities-to-GDP ratio stands at 24 per cent, compared with 40 per cent in Ontario, Quebec and federally.
Bailey said quarterly reports provide a "snapshot" of the province's finances, but earlier projections "remain accurate."
"But I want to caution on reading too much into these figures. They represent a moment in time, and we continue to face significant spending pressures," Bailey said. "This snapshot shows that our deficit is slightly down, but the financial pressures that we face have not abated."
The report said other tax revenues are down, including a drop of $150 million from property transfers, a $100-million dip in provincial sales tax, and $50 million less in tobacco tax.
Bailey said in statement from the ministry that the province is "undoubtedly" feeling the pinch from American tariffs, and the government is focusing on new trade partners, major projects and reducing inefficiencies as B.C.'s economy is expected to grow at a "measured pace."
"It is true that the ongoing, unjust and unpredictable trade policies coming from the United States have had an impact on businesses, but it is also true that B.C. has the natural resources, the geographical advantage, and the skilled workforce that we need to thrive," she said.
Bailey said the province's "advantages" are reflected in the federal government's list of major projects unveiled by the Carney government, four of which are in B.C.
Population growth slowed in B.C. when compared with previous "record breaking" years, Bailey said, with an increase of half a per cent as of July, when growth was just under three per cent the year prior.
The easing is largely due to federal immigration policy, Bailey said.
The minister said inefficiencies targeted by the government include reducing travel expenses, limiting the use of contractors and letting go of land leases.
Bailey couldn't say how much those reductions have saved the public purse.
The ministry's first quarterly report, released in September, had projected a record deficit and was released amid a tumultuous time of "global trade uncertainty," with U.S. tariffs putting a damper on the province's gross domestic product.
The latest report lists several capital projects worth more than $50 million added since the last report, including the Simon Fraser University Medical School facility at $521 million and eight BC Hydro projects worth more than $1.2 billion.
"B.C.'s economy has many strengths, but we continue to face challenges," Bailey said. "Complex and changing trade relationships amid global headwinds and growing cost of service delivery are among the challenges faced by governments around the world, including ours."
Picture Courtesy: THE CANADIAN PRESS/Darryl Dyck
