As the province leading Canada in economic growth, British Columbia produced a balanced 2015-16 budget while making record levels of investment in core services like healthcare and education, Finance Minister Michael de Jong announced today with the release of the 2015-16 Public Accounts.
British Columbia ended the 2015-16 fiscal year with a surplus of $730 million. Compared to 2014-15, government committed an additional $2.4 billion to core services like health, education and the natural resource sectors. Revenues increased by $1.5 billion or 3.2% compared to the previous year, mainly due to taxation revenue.
Stronger revenues, improved economic growth, and prudent fiscal management allowed government to increase spending by $2.4 billion (5.5%) over last year to support priority programs and services, while still maintaining a balanced budget. Compared to last year:
- $833 million increase in health care spending.
- $385 million increase in education spending.
- $259 million increase in social services spending, including for child, youth and community living, and the extension of the BC Early Childhood Tax Credit.
- Natural resource and economic development spending, which also includes direct fire, forest revitalization, flood mitigation and film tax credits, increased $371 million.
- All other sectors increased by $589 million.
Improvements in provincial revenues came in part from increased taxation revenue of
$1.2 billion and a $368 million increase in contributions from the federal government. Personal income tax revenue increased by $304 million or 3.8%. Other revenue increases included corporate income tax (5.8%), provincial sales tax (3.3%) and the property transfer tax (43.9% or $468 million) compared to 2014-15.
Government also made important investments in capital infrastructure, with spending on hospitals, schools, post-secondary facilities, transit and roads totalling $3.5 billion in 2015-16. Self-supported infrastructure spending on electrical generation, transmission and distribution projects, the Port Mann Bridge and other capital assets totalled $2.5 billion. The list of projects includes $918 million to upgrade B.C.’s transportation network, $1.2 billion to build, upgrade and modernize K-12 and post-secondary schools and $924 million spent on health facilities.
Provincial government direct operating debt was reduced by $1.2 billion compared to 2014-15 levels and is forecast to decline to $2.7 billion by 2018-19, a low point not seen since 1984-85. Taxpayer-supported debt-to-GDP – a key measure of affordability – declined to 17.4% from last year’s ratio of 17.5%, in line with the Budget 2015 forecast.
Total provincial debt, calculated by combining taxpayer-supported debt and self-supported debt, increased by $2.4 billion or $418 million less than forecast at budget. Of this total, $1.5 billion was self-supported debt.
Preliminary GDP growth numbers show the British Columbia economy grew by an estimated 3% in 2015, more than triple the national average and an improvement on 2014’s growth rate of 2.6%. Unemployment for 2015 was 6.2%, a 0.1% increase over 2014 but lower than the national average of 6.9%.
British Columbia continues to benefit from strong credit ratings with Moody’s (Aaa), Standard and Poor’s (AAA) and Dominion Bond Rating Service (AA High), reflecting B.C.’s strong fiscal performance. In April, Standard and Poor’s described British Columbia’s financial management practices as “the best among the Canadian provinces,” with financial disclosures that are transparent, comprehensive and timely.
Minister of Finance Michael de Jong –
“Renewed economic challenges both in Canada and abroad show the importance of British Columbia’s commitment to prudent fiscal management. British Columbia’s position as a fiscal leader among provinces has given us the flexibility to make affordable investments in priority areas while continuing to pay down the operating debt. While other jurisdictions brace themselves against the latest economic headwinds, B.C. continues to build and plan for the future while keeping our budgets balanced.”
Public Accounts presentation:
Online versions of the Public Accounts and related documents:
Unaudited Public Accounts supplementary data sets including salary information, travel expenses and payments to suppliers are available on the Data B.C. website: www.data.gov.bc.ca
Government purchasing card transactions are now published quarterly on Data BC:
A backgrounder follows.