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Finance

Public Accounts confirm 2015-16 balanced budget

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Finance

Public Accounts confirm 2015-16 balanced budget

Media Contacts
Jamie Edwardson
Communications Director
Ministry of Finance
250 356-2821
(flickr.com)
Media Contacts
Jamie Edwardson
Communications Director
Ministry of Finance
250 356-2821

Backgrounders

British Columbia's 2015-16 fiscal year

Surplus:

The Province ended the 2015-16 fiscal year with a surplus of $730 million, $353 million more than forecast in the update provided with Budget 2016, which includes the inaugural $100 million commitment to the Prosperity Fund. Government remains on track to balance the 2016-17 budget.

Economic Growth:

British Columbia’s economy grew by an estimated 3% in the 2015 calendar year, the highest rate among the provinces and above the national average of 0.9%, according to preliminary GDP by industry data from Statistics Canada. The estimated 3% growth for B.C. in 2015 is higher than the government’s Budget 2016 forecast of 2.4%. Growth was spread across most industries, with the strongest gains in educational services (6.9%) and retail trade (6.3%). Retail sales improved by 6% and strong gains were also noted in agriculture, forestry, fishing and hunting. The value of international merchandise exports from British Columbia increased by 0.6% in 2015 as declining commodity prices and unbalanced global demand took a toll on the value of B.C. exports.

Revenue:

Provincial revenue totalled $47.61 billion in 2015-16, an increase of $1.475 billion over 2014-15, driven primarily by taxation revenue, which increased $1.27 billion over the prior year.

The Province received $1.2 billion more taxation revenue than forecast at Budget 2015, which reflects a strong economy. Provincial sales tax revenues increased by $192 million, in line with growth in consumer spending, retail sales and business investment. Corporate income tax generated an additional $152 million. Personal income tax revenues came in $304 million higher than the previous year. Increased activity and values in the property market yielded an additional $468 million in property transfer tax revenue, while all other taxes generated an additional $154 million.

Petroleum, natural gas and mineral revenues decreased by $464 million from 2014-15. Forestry revenue improved by $111 million.

Expense:

Operating expenses totalled $46.88 billion, a $2.44 billion increase from 2014-15 and $1.05 billion more than predicted in the 2015-16 fiscal plan. Expense is higher than budget primarily due to the cost of fighting forest fires, expenses related to film tax credits, and increased program spending.

Debt:

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, the most commonly used measure of debt, was $65.29 billion. Debt increased by $2.4 billion over 2014-15.

British Columbia is saving money by paying down the direct operating debt, which is forecast to decline to $2.7 billion by 2018-19 – its lowest point since 1984-85. Balanced Budget 2016 is forecast to invest $1.6 billion in new and increased spending over three years on core services in addition to annual 3% increases in the health ministry budget, almost $500 million of which is funded by lower interest costs due to the retirement of operating debt.

Capital:

Last fiscal, the Province invested $3.5 billion in taxpayer-supported capital projects like schools, roads, public transit and hospitals. Of this total, $924 million was directed to key health facilities like the BC Children’s and Women’s Hospital in Vancouver and two hospital replacement projects on North Vancouver Island. British Columbia has also invested funds in new or replacement high schools in Surrey, Coquitlam and Victoria. For post-secondary, trades training facilities are being expanded or renewed at Okanagan College in Kelowna and Camosun College in Victoria, while transportation projects like the Evergreen Line and Highway 1 improvements are helping to power the provincial economy.

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